Information from the Brazilian and international Electric Power Sector and its companies, since June 1998.

1) Investments

AES Brasil's president, Luiz David Travesso, informed that the company should invest about US$ 350 million in eight months to increase Cesp Tietê's generation. (28.10.1999)

Cemig's management council approved, against Southern Electric's position, the construction of Aimorés power plant and the raising of R$ 276.6 million through ensuring receivables. (28.10.1999)

AES's director, Demóstenes Barbosa da Silva, informed that the company may be able to meet São Paulo government's requirement of increasing Cesp-Tietê's generating capacity by 15% in eight years before scheduled. According to him, this goal may be reached in six years. (27.10.1999)

Brazilian electric system should receive US$ 30 million in investments in the year 2000 in order to prevent generalized blackouts. (27.10.1999)

Cataguazes-Leopoldina informed that it gave up participating of the US$ 400 million project for the construction of Norte Fluminense thermoelectric power plant in Macaé. (27.10.1999)

2) Financing

BNDESPar will auction 6 billions of Eletrobrás ordinary shares, along with a same number of exchange options on these papers on 29.10.1999. The minimum price fixed for each thousand shares is R$ 34.50. (27.10.1999)

Maesa consortium, responsible for the construction of Machadinho hydroelectric, waits for the liberation of a BNDES loan of up to 160 million. (27.10.1999)

Bandeirante prepares the emission of R$ 280 million in debentures convertible into shares. They will enter the market as soon as the operation is approved in a General Executive Assembly scheduled for 28.10.1999. (26.10.1999)

3) Mergers, Acquisitions and Join Ventures

Inepar confirmed that it will concentrate operational activities at S.A Indústria e Construções and divide holding activities into three large business units. The units that will concentrated on attributions are those of construction, energy and telecommunications. The energy operating sector will be concentrated at Inepar Energia S.A business unity. (27.10.1999)

4) Tariff

The Secretary of Mines and Energy, Benedito Carraro, announced that Aneel studies creating an exchange "trigger" to readjust costs of the thermoelectric plants that use imported gas and components. (26.10.1999)

5) Privatization

The Minister of Mines and Energy, Rodolpho Tourinho, declared that national capital should have priority in the future privatizations of electric industry companies. (28.10.1999)

The Senate's Committee of Constitution and Justice (CCJ) rejected for unanimity the project that proposed holding a plebiscite for Chesf's privatization. (28.10.1999)

São Paulo's energy secretary, Mauro Arce, estimated that the minimum price for Cesp Paraná should be R$ 2 billion. In order to arrive at this figure, the secretary considered that Cesp-Paraná's generating capacity is three times higher than Cesp Tietê's. (27.10.1999)

The municipality of Campina Grande, in Paraíba State, postponed Celb's auction to 11.11.1999. (27.10.1999)

AES Gerasul Emp. Consortium won Cesp-Tietê's auction paying R$ 938,066,281.01, which represents a premium of 29,97% over the minimum price. Three groups deposited in Bovespa the financial guarantees needed to participate in Cesp-Tietê's privatization auction. The consortiums were led by the AES, Tractebel, and VBC Energia. (27.10.1999)

A decision of the Federal High Court's president, Carlos Velloso, resumed Furnas' privatization process. Velloso adjourned an initial decision given by the Federal Regional Court of the 2nd Region which suspended the division of Furnas nuclear sector, occurred in fact in 1997. (26.10.1999)

Cesp-Tietê's privatization auction is confirmed for 27.10.1999. (26.10.1999)

The Liquidation and Custody Chamber of the Rio de Janeiro stock Market released the list of pre-identified candidates for participating in Celb's privatization auction. (25.10.1999)

6) Electric System

The electric energy invoice bills to the 693 thousand consumers of Cataguazes-Leopoldina and the companies it controls, Energipe and Cenf, added up to 2.342 GWh in the period from January to September 1999. (26.10.1999)

Light's president, Michel Gaillard, said that the company will be operating during the summer of 2000 with a 5% reserve of the total demand expected for the period, which is 7,4 thousand MW. (26.10.1999)

7) Moreover

The US Commerce Sub-Secretary for International Affairs, David Aaron, included Minas Gerais' government maneuvers to cancel the contractual rights of two American companies that are Cemig's minor shareholders among the several market access issues that Washington follows in its commercial ties with Brazil. (27.10.1999)

Minas Gerais Law Court confirmed the deferment of Cemig's minor shareholder's veto power, but did not agree with the total revocation of the shareholders agreement, as the Minas Gerais government wished. (26.10.1999)

In a General Executive Assembly held on 25.10.1999, Cemig approved the proposal of reforming its social contract. (25.10.1999)