2008
Annual Report
2008Annual Report Message from the President
Annual Report 2008
4
Annual Report 2008
Stronger, integrated, full of plans for the future. This is how the Eletrobrás System ended
2008. The year, which began with the expectation of the approval of Law 11.651, brought with
it a strengthening of the company, the expansion of its scope of activities and the finalization
of projects that had been heating up for years. A Transformation, with a capital “T”, began
for all of the companies in the System. An exceptionally good net profit of R$ 6,136,497,000
crowned a period of excellent results.
The sanction of Law 11.651 in April increased the Company’s flexibility in its ability to
conduct its business, opening the possibility of international business and the formation of
consortiums and participation with other companies in Brazil and overseas. This means that
Eletrobrás gained even more opportunities to act as a leader in the electric power industry.
To meet these new challenges, the creation of the Board of Distribution marked the end of
an era of chronic problems with the electric power distribution companies in the North and
Northeast. With unified management, a reduction in operating costs and integrated strategic
planning, the results are already beginning to appear.
In the subsidiaries, the change in the company bylaws ratified the role of the holding com-
pany. The new conditions in corporate governance were the focus of various projects in the
Transformation Plan for the Eletrobrás System, developed to adapt the companies to their new
role in Brazil’s electric power industry. A series of articulated actions was designed to increase
the income earning possibilities and reduce operating costs.
The significant achievements in 2008 reflect these internal changes, as well as the perfor-
mance of a team with more than 27,000 employees today. The start of trading of our shares on
the New York Stock Exchange represents on the one hand the recognition of our transparency
and, on the other, the perspective of greater visibility of our securities and the increase in the
market value of the company.
In the area of sustainability, the listing of the company, for the second year in a row, on
the Corporate Sustainability Index of the São Paulo Stock Exchange (ISE/Bovespa) is yet ano-
ther confirmation of the positive choices that have been the hallmark of our corporate gover-
nance and our decisions with regard to environmental, social and economic-financial issues.
As the largest company in Brazil’s electric power industry, the Eletrobrás System made
an important contribution to the history of Brazil in 2008. Companies of the Eletrobrás Sys-
tem formed partnerships that participated successfully in the auctions for Jirau hydroelectric
power project, the transmission lines for Rio Madeira and the giant Tucuruí-Manaus-Macapá
transmission line. In addition, the resumption of construction activities at Angra 3 and Belo
Monte that reflect a more modern approach, which begins a new cycle in the construction
of hydroelectric power plants. And, once again, the company performed an important role in
the federal government programs – Light for Everyone, The Incentive Program For Alternative
Electric Power Sources (Proinfa) and the National Program for Electric Power Conservation
(Procel).
It was a year of hard work with changes, excellent results and achievements. At the end,
2008 left us with an expectation of many years to come filled with energy. The internationa-
lization of the company and the Tapajós complex, with 10,600 MW and five plants, are two of
the most promising projects along with the resumption of the work at Angra 3 and auctions for
Belo Monte. The Transformation Plan for the Eletrobrás System will continue to help prepare
us all for these and other commitments that Eletrobrás is proud to assume with Brazil and the
Brazilian people.
José Antonio Muniz
President of Eletrobrás
5
Index
Annual Report 2008
II – Corporate Identity ........................................................................................... 8
1 – Company Profile ........................................................................................... 9
III – Profile......................................................................................................... 10
1 – The Company..............................................................................................11
2 – Generation, Transmission and Distribution ......................................................12
3 – Electric Energy Research Center (Cepel) ..........................................................14
4 – Shareholder Interests ..................................................................................15
5 – International Activities ...............................................................................16
IV – Management ................................................................................................ 18
1 – Transformation Plan for the Eletrobrás System – PTSE .......................................19
2 - Strategic Planning ......................................................................................20
3 – Corporate Management ................................................................................21
4 - Corporate Governance ..................................................................................22
V – The Energy Market ........................................................................................ 24
1 – Expansion of Generation ..............................................................................26
2 – Expansion of Transmission ...........................................................................27
3 – Auction for Transmission Lines .....................................................................28
4 – Frontier Interconnections ............................................................................29
5 – International Market ...................................................................................30
VI - Investment .................................................................................................. 32
1 – Accelerated Growth Program (PAC) ................................................................34
2 – Subsidiary Company Funding ........................................................................37
3 – Stockholders’Participation ............................................................................38
VII – Funding ...................................................................................................... 40
VIII – Corporate Performance .............................................................................. 42
1 – Generation and Transmission .......................................................................44
2 – Distribution ...............................................................................................48
Ix – Capital Market ............................................................................................. 54
1 – Shareholder Base .......................................................................................55
2 – Eletrobrás Share Analysis ............................................................................57
3 – Market Value (R$ Millions) ............................................................................58
4 – Rating .......................................................................................................58
5 – Shareholder and Investor Relations ...............................................................60
6
Index Annual Report 2008
6 – Shareholder Remuneration ............................................................................61
7 – ADR Program – New York Stock Exchange (NYSE) .............................................62
8 – Latibex – Madrid Stock Exchange ..................................................................63
x – Compulsory Loan ........................................................................................... 64
xI –Sector Funds ................................................................................................ 66
1 – Global Reversal Reserves (RGRs) ...................................................................67
2 – Energy Development Account (CDE) .............................................................68
3 – Fuel Consumption Account (CCC) ...................................................................69
xII – Government Sector Programs ........................................................................ 70
1 – National Program for Efficient Public Illumination (Reluz) ................................71
2 – National Program for Electric Energy Conservation (Procel) ...............................72
3 – Incentive Program for Alternative Sources of Electric Energy (Proinfa) .............73
4 – National Program for Universal Access to Electric Power (“Light for Everyone”) .....74
xIII – Program for Technological and Industrial Development (PDTI) ..................... 76
1 – Research & Development (R&D) .....................................................................77
2 – Standards and Quality .................................................................................79
xIV – Social Dimension ........................................................................................ 80
1 – Personnel Management ...............................................................................81
2 – Community and Society Relations ..................................................................85
xV – Information Technology ............................................................................... 88
xVI - Environment ............................................................................................... 90
xVII – Awards and Recognition ............................................................................. 92
Financial Statements for 2008 .............................................................................. 94
Attachment ....................................................................................................... 219
Board of Executive Directors ............................................................................... 236
Independent Auditors Report ............................................................................. 238
Summary Information ........................................................................................ 244
7
II – Corporate Identity
Annual Report 2008
Eletronorte - Mato Grosso To
(Eletronorte Image Bank)
8
Annual Report 2008
1 - Company Profile
Mission
To create, supply and implement solutions for the domestic and international market for
electric energy, with corporate excellence providing profitability and social and environmen-
tal responsibility, contributing to the development of Brazil and in the countries in which it
operates.
Vision
To be a worldwide reference in the electric energy industry, with corporate efficiency, pro-
fitability and social and environmental responsibility.
Values
Ethics, integration, recognition of the individual, excellence in management, transparency
and social and environmental responsibility.
9
III – Profile
Annual Report 2008
Eletronorte –Rotor for Unit
22 of the UHE Tucuruí
(Eletronorte Image Bank)
10
Annual Report 2008
1. The Company
Eletrobrás is a publicly traded mixed-capital company, controlled by the Federal Govern-
ment of Brazil. It was created in 1962 to conduct and promote studies, projects of construc-
tion and operation of generator plants, transmission lines and substations in order to supply
electric power to Brazil. It is the largest holding company in the electric power industry in
Latin America, responsible for nearly 60% of the transmission lines and 40% of the installed
capacity to be used in the generation of electricity in Brazil.
Currently, the Eletrobrás System is composed by six companies which are responsible for
the transmission and generation of electric energy: Cia. Hidroelétrica do S.Francisco - Chesf,
Furnas Centrais Elétricas S.A. (Furnas), Centrais Elétricas do Norte do Brasil - Eletronorte,
Eletrobrás Termonuclear S.A. - Eletronuclear, Eletrosul Centrais Elétricas (Eletrosul) and Com-
panhia de Geração Térmica de Energia Elétrica (CGTEE). In addition, the Company holds 50%
of the capital stock of Itaipu Binacional, and has six electric power distribution companies
(Ceal, Ceron, Cepisa, Manaus Energia, Boa Vista Energia, Eletroacre) and Cepel, which is the
largest electric power research center in the southern hemisphere.
The Federal Government holds 58% of the common shares of Eletrobrás, which are traded
on the New York, São Paulo and Madrid Stock Exchanges. The company is the principal agent
and investor for the Government in the domestic electric energy sector and has been updating
its management practices to align them with international trends.
The companies of the Eletrobrás System have an installed capacity of 39,753 MW, provided
by 30 hydroelectric power plants, 15 thermal electric plants and two thermo-nuclear plants. In
addition to financing the development of projects of generation, transmission and distribution
of electric energy, Eletrobrás plays an important role as manager of government programs in
energy area such as “Luz para Todos” (Light for Everyone), which aims at expanding consumer
service. The company also fosters the use of alternative energy sources, by means of programs
to encourage the use of Alternative Sources of Electric Energy (Proinfa), and the efficient use
of electric energy, through its National Program F for Electric Energy Conservation (Procel).
11
2. Generation, Transmission and Distribution
Annual Report 2008
Usinas
3
15
10
2
10
4
44
%
31
7
62
Eletronuclear -
Angra 2 Nuclear Power Plant
(Eletronucler Image Bank)
DISTRIBUTION
TABELA 1
Situation on
31/12/2008
CGTEE
Chesf
Eletronorte
Eletronuclear
Furnas
Manaus Energia
Nuclear
Total*
Hydroelectric*
(MW)
Plants
Potential
---
Usinas
---
Thermo-Nuclear
(MW)
Plants
Potential
490
Usinas
3
(MW)
Plants
Potential
---
10,268
8,694
---
8,122
250
14
4
---
8
1
350
479
---
962
780
1
6
---
---
---
2,007
2
3
---
---
Usinas
---
---
---
2
---
---
2
(MW)
Plants
Potential
490
10,618
9,173
2,007
9,084
1,030
32,402
TOTAL
27,334
27
3,061
15
2,007
*Not Including 50% of Itaipu (7.000 MW)
TABELA 2
Installed Capacity – Situation on 31/12/2008 (MW)
Companies
Eletrobrás System
Itaipu (50%)
Others *
UHE
27,334
7,000
43,174
UTE
3,061
---
19,695
UTN
2007
---
---
Brazil
77,508
22,756
2,007
(EOL+SOL)
---
---
338
338
Total
32,402
7,000
63,207
102,609
100
* Dados obtidos do relatório da Aneel (SFG). Capacidade instalada até 31/12/2008, subtraída a participação do Sistema Eletrobrás.
TRANSMISSION A 3
High Tension Transmission Lines (above) 230 Kv
Companies
Chesf
Eletronorte
Furnas
Eletrosul
Manaus Energia
TOTAL
*Length of Lines including partners.
Situation on 31/12/08
Length (Km)*
18,010
9,027
16,950
8,165
365
52,537
12
Annual Report 2008
DISTRIBUTION
Growth in the Distributor’s Market in 2008
Consumption of Electric Energy - GWh
2007
Brazil
378,362
2008
392,764
Ceal
Cepisa
Ceron
Eletroacre
Interior Table
Capital Table
Boa Vista Energia
2,124
1,740
1,627
540
570
3,563
378
2,246
1,831
1,743
581
626
3,727
403
Total - Distributors
10,542
11,157
Sources: EPE/MME and DEND/DEN/DE
Growth (%)
Share (%)
3.8
5.7
5.3
7.1
7.6
9.9
4.6
6.5
5.8
100
0.6
0.5
0.4
0.1
0.2
0.9
0.1
2.8
CGTEE - Candiota/RS -
Presidente Médici Plant
(Photo: Gustavo Vara/Satolep Press)
Despite the small participation of the distribution companies of the Eletrobrás System in
the domestic energy market, all of them are presenting a superior growth in comparison to the
national average for the period, which demonstrates the tendency for an increasing participa-
tion of the Eletrobrás System in the electric power distribution market.
Itaipu – Itaipu Plant
(Photo: Caio Coronel)
13
3. Electric Energy Research Center (Cepel)
Annual Report 2008
The largest energy research center in the southern hemisphere, Cepel, has a complex of
30 laboratories, many of them not only pioneering in Brazil, but not seen anywhere else in
South America. Its rich collection of methodology and computer programs are applied to the
planning of the generation and transmission expansion of electric power, taking into account
environmental issues and the use of alternative energy sources.
Its projects in Research, Development and Innovation (PD&I) benefit not only the Eletro-
brás System but also industry organizations such as the Energy Research Company (EPE), the
National Electric System Operator (ONS), the Electric Energy Sales Chamber (CCEE) and the
National Electric Energy Agency (Aneel), in addition to concessionaires and manufacturers.
Among the project developed, one of the strongest is the interconnected hydrothermal plant
system, the operation of the basic energy grid, the development of technologies for the trans-
mission, monitoring and diagnosis of equipment, conservation and efficient use of energy,
metallurgy and new materials development, and technology for the energy use of hydrogen.
Cepel also provides technical support to important government programs and projects,
such as Light for Everyone, Proinfa, Procel and Reluz, as well as cooperating in the preparation
of the Energy Expansion Plans.
Cepel – Chemical Analysis
Laboratory
(Photo: Milton Maurente)
14
Annual Report 2008
4. Shareholder Interests
Eletrobrás has stockholders’ participation in the segments of generation, transmission and
distribution of electric energy, including:
•
•
•
•
111 controlled companies;
26 parent companies with a minority shareholder position;
5 specific purpose companies (SPE), whose capital consists of redeemable preferred sha-
res whose remuneration corresponds to the IGP-M plus interest of 12% per year;
50-% of the capital of Itaipu Binacional.
In addition to the stockholder’s participation, Eletrobrás has Government Bonds from the pro-
cess of privatization of the electric power sector in Brazil which occurred in the 1990s. The most
representative is the CFT-E1 (Treasury Financial Certificates) that has a market value of R$ 209
million.
Itaipu – Sala de Controle
(Foto: Caio Coronel)
15
5. International Activities
Annual Report 2008
On April 7, 2008, Law 11.652 modified the by-laws of Eletrobrás, authorizing the Holding
Company to associate with, directly or through its subsidiaries, with or without funding, for
the constitution of business consortiums in Brazil and off-shore aimed at the exploration of
electric power production or transmission of under a regime of concession or authorization.
For this purpose, the Superintendence of Operations Abroad (PE) was created reporting to
the Presidency. Based on the guidelines determined by the Board of Directors, its role is to
coordinate the activities of the Eletrobrás System in the international market, identifying and
evaluating potential opportunities overseas.
In addition, a structured business plan was developed for priority businesses and coun-
tries, with activities that are expected to be concluded during the first quarter of 2009 accor-
ding to the following strategic guidelines:
•
•
•
•
All project of interest in these segments of generation, transmission and others identi-
fied in the international market will be required to present appropriate profitability;
The insertion into new markets will take place preferably in countries located in South
America (geographic proximity);
An effort will be made to promote the integration of electric power among the countries
in South America and the spread of Brazilian expertise in the segment of generation
based on renewable resources.
Based on these guidelines, the Superintendence for Operations Abroad has been develo-
ping activities together with the local private sector and large international energy groups
aiming at signing a series of agreements for the joint participation in projects that are
considered attractive, in countries of South America, Central America and Africa.
16
Eletrobrás – Inambari
Project – Peru
(Eletrobrás Files)
Annual Report 2008
17
IV – Management
Annual Report 2008
Eletrobrás – Presentation
of the Transformation Plan
(Photo: Jorge Coelho)
18
Annual Report 2008
1 – Transformation Plan for the
Eletrobrás System – PTSE
Studies prepared by the technicians of Eletrobrás and the Ministry of Mines and Energy
during 2006 and 2007, identified the necessity of searching for the transformation and streng-
thening of the Eletrobrás System, through initiatives in two areas:
•
•
Managerial and institutional with changes in the companies of the Eletrobrás System;
Structural and regulatory, with changes pointed out directly by the Federal Government.
To reach internal goals, based on guidelines determined by the Federal Government, the
Company prepared the Transformation Plan for the Eletrobrás System (PTSE). In the search
for a new strategic platform from the institutional, organizational and market-oriented point
of view, the PTSE is designed to provide the Eletrobrás System with a structure of corporate
management that is integrated and transparent, making it more competitive in the operation
and expansion of the service of electric power, capable of providing appropriate remuneration
for its shareholders and contributing to the assurance of meeting the energy needs for the
sustainable development of Brazil. The repositioning includes four vectors of activities:
•
•
•
•
Improvement in corporate governance;
Reorientation of the distribution business;
Institutional restructuring of the holding company;
Reorganization of the corporate management model.
The PTSE is composed of a set of 41 projects, distributed among the four vectors of acti-
vities. To coordinate the activities involved, the Committee for the Management of the Trans-
formation of the Eletrobrás System was created, composed of representatives of each of the
companies in the Eletrobrás System and each of the departments in Eletrobrás.
Transformação
SISTEMA ELETROBRÁS
I S T O FA Z A D I F E R E N Ç A
19
Transformação
SISTEMA ELETROBRÁS
A P E R F E I Ç O A M E N T O D A
G O V E R N A N Ç A C O R P O R AT I V A
Transformação
SISTEMA ELETROBRÁS
R E O R G A N I Z A Ç Ã O D O M O D E L O
D E G E S TÃ O E M P R E S A R I A L
Transformação
SISTEMA ELETROBRÁS
R E F O R M U L A Ç Ã O I N S T I T U C I O N A L
D A E L E T R O B R Á S
Transformação
SISTEMA ELETROBRÁS
R E O R I E N TA Ç Ã O D O S N E G Ó C I O S
D A D I S T R I B U I Ç Ã O
Transformação
SISTEMA ELETROBRÁS
I S T O FA Z A D I F E R E N Ç A
Transformação
SISTEMA ELETROBRÁS
A P E R F E I Ç O A M E N T O D A
G O V E R N A N Ç A C O R P O R AT I V A
Transformação
SISTEMA ELETROBRÁS
R E F O R M U L A Ç Ã O I N S T I T U C I O N A L
D A E L E T R O B R Á S
Transformação
SISTEMA ELETROBRÁS
R E O R G A N I Z A Ç Ã O D O M O D E L O
D E G E S TÃ O E M P R E S A R I A L
Transformação
SISTEMA ELETROBRÁS
R E O R I E N TA Ç Ã O D O S N E G Ó C I O S
D A D I S T R I B U I Ç Ã O
Redução mínima: 5,5cm
2 - Strategic Planning
Annual Report 2008
With the new Directors that took office on March 10, 2008, and the strategic guidelines of
the Minister of Mines and Energy, the Strategic Corporate Plan and its integrated development
for the group of companies was seen as an important factor for the success of the Eletrobrás
System.
The development of the Strategic Plan began with the a selection process for hiring con-
sulting prepared to contribute to the necessary conceptual and methodological support to the
process. This consulting support is to begin in the second semester of 2009.
While the Strategic Plan is being prepared, and because of the need to have strategic
orientation for the corporation immediately for the Eletrobrás System, it was determined that
a pluriannual action plan would be created to take effect already in 2009.
The Strategic Actions Program of the Eletrobrás System (PAE 2009-2012) aligns the cor-
porate strategies in the Eletrobrás mission (corporate excellence, profitability and social and
environmental responsibility) with the vectors and actions that constitute the Plan for Trans-
formation of the Eletrobrás System, together with a set of objectives and goals whose achie-
vement depends on the integrated efforts of the companies of the System.
Eletrobrás – Meeting to discuss
Issues of corporate
management
(photo: Arquivo Eletrobrás)
20
Annual Report 2008
3 – Corporate Management
The reorganization of the corporate management model is one of the four guidelines given
by MME for the strengthening of the Eletrobrás system. It was transformed therefore into one
of the vectors of the PTSE, including 16 principal activities which, when integrated, would
take the holding company and its companies to a new level of management.
These activities include the preparation and implementation of a planned love corporate
restructuring, including the redefinition of organizational processes as well as their indicators
for performance and control, and the realignment of the used information systems, as a way
of meeting the new demands of management. By the end of 2008, initiatives were in process
for the re-adaptation of procedures related to the: Integrated Management of Corporate Risk,
Management of Internal Controls, Management of the Logistics of Supplies, Management of
New Business and Management of Investments, all of them to be applied to all companies of
the Eletrobrás System.
In particular, it should be pointed out that the adaptation of internal controls of all the
companies of the Eletrobrás System to the requirements of section 404 of the Sarbannes-Oxley
law (SOX) that will allow the trading of ADRs level 2, initiated in October 2008 on the New
York Stock Exchange, should be maintained.
Further in 2008, was developed a model for the integrated management of corporate risks
for the holding company. This project produced: the mapping of the universe of risks for the
company; the identification of the most important corporate risks - that have a direct impact
on its strategic financial objectives; the definition of methodology for treatment; and the
recommendations of actions for the implementation of the management of identified risks.
Some of these activities are now in process and it is expected that they will be implemented
during 2009. In parallel , within the Transformation Plan a replication of the methodologies
developed to other companies of the Eletrobrás System is being examined.
Specific activities to mitigate the financial risks associated with currency variation were
also put in practice and in 2008. Based on the exchange rate hedging policy, approved at the
end of 2007, designed to protect the net asset exposure in dollars, short-term operations with
derivative instruments, in the amount of US$ 280 million were realized. These operations will
continue incorporating not only the mismatch in foreign currency over the next fiscal years,
but also the protection of the results of the Company against adverse movements in the rates
of interest, price indices and maturities.
Finally, it should be noted that the extension of corporate risk management practices
throughout the System will satisfy the precepts of Corporate Governance and contribute to an
increase of the return to the shareholder, which, in the final analysis, should have an impact
on the valuation of the company by the financial market and the consolidation of its partici-
pation in the electric power sector.
21
4 - Corporate Governance
Annual Report 2008
The principal organs of governance of Eletrobrás, formerly constituted and with regular
responsibilities, are:
•
•
•
•
General Shareholders Meeting – during 2008, six General Meetings were held; five of
them were Special and one was a General Shareholders Meeting.
Board Of Directors – composed of nine members, of which seven are nominated by the
MME; one by the Ministry of Planning, Budget and Management; and one by the mino-
rity shareholders, elected in a separate vote in the General Meeting, not including the
controlling shareholder. The meetings are monthly, dedicated to corporate and strategic
issues for the Eletrobrás System.
Fiscal Committee – the internal operating regimen was changed in 2006 to respond to
the requirements of the Sarbanes-Oxley Law (SOX). A permanent committee composed
of five members elected by the General Shareholders Meeting: three nominated by the
majority shareholder (one indicated by the Ministry of finance, which represents the
National Treasury); one by the minority shareholders; and the other by the preferred
shareholders. These meetings are held monthly and, when necessary, held jointly with
the Board Of Directors.
Board of Executive Officers - made up of the Presidency and five other Boards: Admi-
nistration, Distribution, Engineering, Technology and Finance and Investor Relations.
Weekly meetings are dedicated to the conduct of business of Eletrobrás and the System,
based on the strategic guidelines provided by the Board Of Directors.
Since 2006, in order to increase the transparency of information provided to stakeholders,
Eletrobrás has adhered to the Level 1 of the Corporate Governance of Bovespa. In 2008, the
Ministry of Mines and Energy prepared new guidelines for the management of the company.
Among these are the improvement and expansion of best practices in corporate governance.
To meet this requirement, the company management faces new challenges:
•
•
•
•
Greater effectiveness in the actions of the members of the Fiscal and Director Boards, in
representing Eletrobrás in the companies in which they have a shareholder position.
An increase in the ranking of the Eletrobrás System in the Bovespa Index of Sustainabi-
lity (ISE Bovespa).
Listing on the Dow Jones Sustainability Index (DJ SI) By 2012.
An Increase to Level 2 of the Corporate Governance of Bovespa By 2012.
Finally, it is important to point out that for the second consecutive year, Eletrobrás was
listed on the Bovespa Index of Corporate Sustainability (ISE/Bovespa). Listing on this index
signifies a commitment to corporate sustainability, which represents a differential for inves-
tors. It means, also, that the company has investments that are compatible with the require-
ments for sustainable development.
22
Annual Report 2008
23
Isto faz a diferença
Eletrobrás – Sox Project
- Discussion of the
methodology of
documentation
(Photo: Jorge Coelho)
V – The Energy Market
Annual Report 2008
Eletronuclear – Mainte-
nance Activities during
the planned shutdown of
Angra 2
(Photo: Marco Antônio Alves)
24
Annual Report 2008
In 2008, the consumption of electric power in Brazil grew by 3.8%, reaching 392.8 TWh,
according to the Energy Research Company (EPE). All regions registered growth in consump-
tion, and only the Southeast remained below the average (3.3%), which shows the gradual
loss of its share in total consumption. The center-West region, in turn, was where the greatest
growth in consumption was seen (7.0%). The sale of energy by region, although it continues
to be highest in the Northeast (40.9%), is almost identical to that of the Southeast (38.2%),
while 12.2% (South); 5.3% in the Center West; and 3.4% for the North, represent the con-
sumption of other regions.
The companies in the Eletrobrás System behave in a regional manner, with coverage pro-
vided to areas that do not correspond exactly to Brazil’s geographic regions. In the south of
Brazil, Eletrosul covers not only the states of the South region but also Mato Grosso do Sul
which lies in the Center-West Region, with a population of approximately 30,000,000 inha-
bitants (approximately 60% of Brazil’s population) and the GDP for the region accounts for
approximately 60% of Brazil’s GDP. More than 40% of all the energy consumed in Brazil passes
through the Furnas System. The share of the company and the supply of energy is 97% in the
Federal District; 92% in Rio de Janeiro; 91% in Mato Grosso; 81% in Espírito Santo; 61% in
Goiás; 58% in São Paulo; 45% in Minas Gerais; and 16% in Tocantins.
In the Northeast Region, the coverage by Chesf extends to an area of more than 1 million
km2, inhabited by more than 50 million people. Eletronorte covers an area that includes the
states of the North Region in addition to the state of Maranhão. The principal feature of the
regional market serviced by this company is the fact that - although the population and regio-
nal GDP are the lowest in the country - there are large industrial complexes that are electro-
intensive, as well as projects for the implantation of new power plants and/or the expansion
of the existing power plants, which represents an increase of power for the future.
Regional developments are assaulted with projects implemented already or that will be
implemented in each region. Examples can be found, in the case of the Northeast Region, the
consolidation of the Suape industrial complex, and the pharmaceutical/chemical and blood
products complexes in Pernambuco; in Ceará the establishment of the Pecém complex and the
implementation of a steel manufacturing facility; and in Bahia the consolidation of the auto-
mobile complex. For its part, in the North Region, the growth of the consumption of electric
energy will occur in a more intensive manner than the others because of the installation of new
electro-intensive industrial plants. In the Center-West Region the expansion of agribusiness,
accompanied by an increase in extractive activities, will tend to raise the consumption as it
requires installation of industrial transformation plants (as in the steel and home furnishings
industries). In the Southeast and South Regions, because they are more industrialized and
developed, they will tend to lose share in the national market for electric power because of
the more accelerated growth of the other regions and by the natural tendency for migration of
industries located in this region to other regions.
With regard to the share of potential installed domestic capacity, which in 2008 reached
102,609 MW, the Eletrobrás System reached a total of 39,402 MW installed, representing 38%
of the market in Brazil.
25
1 – Expansion of Generation
Annual Report 2008
The Ten Year Plan for the Expansion of the Energy prepared by EPE/MME for the period
2008-2017 forecasts a contribution by the Eletrobrás System of 35,676 MW in projects of
generation directly or by stockholders’ participation. It is important to highlight that from
this total, 10,573 MW will come from projects that already have a concession, being 2,212
MW from direct participation and 8362 MW from stockholders’ participation. We pointed out
that 99% of the participation of the Eletrobrás System is related to projects in clean energy
– 33,976 MW in hydro projects (including large projects such as the Belo Monte hydroelectric
plant and the Santo Antônio and Jirau projects on the Tapajós River) and 1350 MW in nuclear
energy (Angra 3).
With the intention of participating in the coming auctions for new energy (A-5), the Ele-
trobrás System is developing feasibility studies and hydroelectric project, both directly and in
partnership with private sector companies, in the amount of 32,300 MW.
TABELA 5
PLANTS ExPECTED TO ENTER AN OPERATION
COMPANY
UHE
(MW)
Operation
Commercial
Passo São João
Barra do Chapéu
Simplício
Batalha
UTE
Presidente Médici (Candiota III)
UTN
Angra 3
Eletrosul
Furnas
CGTEE
Eletronuclear
TABELA 6
Classification
Auction 2005
Authorization
Auction 2005
Auction 2005
Nov/09
Nov/10
Jul/10
Feb/11
Jan/10
Concession
77
15
334
53
350
1,350
Nov/14
Concession
PRINCIPAL PARTICIPATION IS SPEs
COMPANY
Chesf/Eletronorte
Chesf/Eletrosul
Eletrosul
Furnas
UHE
Dardanelos
Jirau
Mauá
Peixe Angical
Baguari
Retiro Baixo
Foz do Chapecó
Serra do Facão
Santo Antônio
Share (%)
24.5/24.5
20/20
49
40
15
49
40
49
39
MW Op. Commercial Classification
Auction 2006
261
Auction 2008
3,300
Auction 2006
362
452
---
Leilão 2005
140
Leilão 2005
82
Concessão
855
Concessão
210
Leilão 2007
3,150
Jan/10
Jan/13
Apr/11
---
Sep/09
Jan/10
Aug/10
Oct/10
May/12
26
Annual Report 2008
2 – Expansion of Transmission
The PDE 2008/2017 calls for the active participation of the Eletrobrás System in activities
related to the expansion of transmission. The companies are already participating in Study
Groups for Regional Transmission (GET) that provide support for EPE in the planning of regio-
nal transmission, and the realization of studies of regional interconnection and the integra-
tion of among power plants.
A selection of the most important projects would include the transmission system for the
hydro electric power complex on the Madeira River, in which the studies prepared by compa-
nies of the Eletrobrás System played an outstanding role, contributing to the success obtained
in the auction for transmission. An additional highlight was the work on the Tucuruí-Macapá-
Manaus interconnection that will make it possible for the systems in the Amazon region,
currently isolated, to be connected with the National Interconnected System (SIN).
In 2008, the companies of the Eletrobrás System added 504 km of transmission lines to
the SIN and 3077 MVA in capacity of transformation at the substations. In partnership with
companies from the private sector, the so-called Specific Purpose Corporations (SPE), an addi-
tional 695 km of transmission lines and 672 MBA in capacity of transformation in substations
were added to the system.
TABELA 7
TRANSMISSION LINES
Project
Tension (kV)
Company/Partner
Length (KM)
Gravataí 3/ Atlântida 2
Pimenta Bueno/ Vilhena
Miracema/ Gurupi
Peixe 2/ Serra da Mesa 2
*Eletronorte 37%; Chesf 12%
TABELA 8
SUBESTAÇÕES
Project
Vilhena
Nova Santa Rita
Barreiras
Biguaçu
230
230
500
500
Eletrosul
Eletronorte
INTESA*
INTESA
102
160
255
195
Tension (kV)
230
Company/Partner
Eletronorte
Length (KM)
120
525
230
500
Eletrosul
CHESF
Eletrosul/SC Energia
672
200
672
27
3 - Auction for Transmission Lines
Annual Report 2008
The success obtained by the Eletrobrás System in the four auctions for transmission lines
sponsored by Aneel in 2008 demonstrates the strength of the companies, which acquired 13 of
the 29 lots auctioned, a total of 6415 km of transmission lines (229.3% of the total offered).
The annual income that will be earned from the operation of these projects will be around R$
868.8 million. The highlights of the acquisitions include:
•
•
•
– Eletronorte and Chesf, in partnership with private sector compa-
Auction 004-2008
nies, are part of the Amazônia Consortium that purchased lot C (the Tucuruí-Macapá-
Manaus connection).
– Eletronorte and Eletrosul, in partnership with private sector com-
Auction 007-2008
panies, are part of the Integração Norte Brasil Consortium, that purchased lots A, C and
G of the transmission system for the Madeira River hydroelectric power plants, where the
investments are expected to exceed R$ 6 billion. Lots D and F were purchased by the
Madeira Transmission Consortium, in which Chesf and Furnas are partners.
– Furnas is part of the Renewable Transenergy Consortium, winner
Auction 008-2008
of lot C, that has an Allowable Annual Income (RAP) of R$ 34.5 million and includes: LT
230 kV Chapadão-Jataí (CD of 128 km); LT 230 kV Barra dos Coqueiros-Quirinópolis (CS
of 50 km); LT 230 kV Palmeiras-Edéia (CS of 60 km); SE Jataí 230 kV; SE Quirinópolis 230
kV; and SE Edéia 230 kV.
28
Annual Report 2008
4 - Frontier Interconnections
Interconnection with Uruguay, using the Rivera frequency conversor station – Throu-
gh an agreement with the Uruguayan state company Administración Nacional de Usinas y
Transmisiones Eléctricas (UTE), Eletrobrás granted, with indemnification, the right to use the
conversion facilities. The results from the sale through CCEE through November were positive
by R$ 12,600.
Interconnection with Argentina using the Uruguaiana frequency conversor station
– In order to facilitate the return of exchange operations using the Uruguaiana conversion
station, Eletrobrás, Eletrosul and Emprendimientos Energéticos Binacionales Sociedad Anôni-
ma (Ebisa) are negotiating a solution for the debt between the Argentinean company and
Eletrosul.
Furnas - Transmission towers
From the Foz do Iguaçu substation
(Photo: Bruno Ribeiro)
29
5 – International Market
Annual Report 2008
Based on the activities of the Superintendence for International Operations, the following
business opportunities in the international market were identified and are currently under
study by the Eletrobrás System and its partners:
30
Based on the activities of the Superintendence for International Operations, the following
business opportunities in the international market were identified and are currently under
study by the Eletrobrás System and its partners:
Annual Report 2008
•
•
•
•
•
•
31
UHE Tumarín (180 MW) – Preparation of Feasibility Studies.
Aproveitamento Hidrelétrico Binacional de Baynes (360 MW) - Prepa-
UHE Garabi (1800 MW) – Preparation of Inventory and Feasibility Studies.
Argentina:
Angola/Namíbia:
ration of Feasibility Studies.
Nicarágua:
Preparation of Pre-Feasibility Studies for the following hydroelectric projects: Pa-
Peru:
quitzapango (1,380 MW), Sumabeni (1.080 MW), Urubamba (950 MW), Cuquipampa (800
MW) and Vizcatan (750 MW). Start of Feasibility Studies for the Inambari hydroelectric
plant (2,000 MW).
Venezuela:
of electric power between the two countries.
South and Central America and Africa:
Study of the Interconnection of electric power, with a view to an exchange
New projects are in the initial stages.
VI - Investment
Annual Report 2008
Furnas – Project under the Accele-
rated Growth Program (PAC) AHE
BAGUARI
(Photo: José Lins)
32
In 2008, the Eletrobrás System invested R$ 3.8 billion in the generation, transmission and
distribution of electric power. The most important projects are shown below:
•
•
•
•
•
•
•
•
Irrigation of the lots in the resettlement areas of the Itaparica Plant;
Implantation of the UHE Simplício;
Implementation of the UHE Passo São João;
Implementation of the Candiota III – Phase C;
Expansion of the transmission system of the South Region;
Repairs and improvements of the transmission system in the areas of São Paulo and
Minas Gerais;
Transmission system in Pará, associated with the UHE Tucuruí;
Light for Everyone Program.
TABELA 9
Nature of the Investments
(R$ Millions)
Generation
Transmission
Distribution
Environmental Quality
Research
Infrastructure
Total
2008
2,019
1,190
384
30
28
227
3,878
2007
1,284
1,288
332
20
18
162
3,104
%
57.2
-7.6
15.7
49.0
55.6
40.3
24.9
Annual Report 2008
33
1 - Accelerated Growth Program (PAC)
Annual Report 2008
Em 2008, o Sistema Eletrobrás investiu, em empreendimentos incluídos no PAC, R$ 2,5 bi-
lhões. O montante equivale a 69,8% dos R$ 3,5 bilhões aprovados para o ano e representa um
crescimento de 22,2% em relação a 2007. Do total, 39% foram destinados à região Sudeste;
29%, à região Sul; 21%, à região Norte; e 11%, à região Nordeste.
Quanto ao tipo de segmento, 78,3% foram investidos em projetos de geração; 14,3%, em
transmissão; e 7,4%, em distribuição. A média de realização orçamentária foi de 69,8%, desta-
cando-se, acima da média, Eletronorte (99,1%), Furnas (88%), Eletrosul (70,7%) e Ceal (99%).
TABELA 11
Investment in PAC - R$ Million
2008
2007
Forecast
Realized
Forecast
Realized
TOTAL
3,534,407
2,469,334
2,660,107
2,020,032
TABELA 12
Generation - In Implantation
Operator
UHE
Consórcio Madeira Energia
Santo Antônio
Consórcio Energia Sustentável do Brasil
Jirau
UF
RO
RO
Furnas. CPFL and CEEE
Foz do Chapecó
SC/RS
Eletrosul and Copel
Mauá
Eletrosul
Passo São João
Furnas. Cemig. Baguari
Baguari
Furnas. Orteng. Logos e Alen
Retiro Baixo
Furnas
Simplício
Eletronorte. Chesf. CNO. Neoenergia
Dardanelos
Furnas
Batalha
Eletrosul
São Domingos
Furnas. Alcoa. DME and CCCC
Serra do Facão
Operator
UTN
PR
RS
MG
MG
MG
MT
MG
MS
GO
UF
MW Operation Expected
3,150
3,300
855
362
77
140
82
334
261
52
48
210
april/12
jan/13
ago/10
sept/11
dec/09
sept/09
jan/10
jul/10
feb/10
mar/11
dec/11
oct/10
MW Operation Expected
Eletronuclear
Angra 3
RJ
1,350
out/14
Operator
UTE
CGTEE
Candiota III
UF
RS
MW Operation Expected
350
jan/10
34
Annual Report 2008
TABELA 13
Generation – Inventory Studies
Operator
UHE
UF
Eletronorte. CCCC
Bacia do Rio Tapajós
PA/AM
Eletronorte. Engevix. Themag. OAS
Bacia do Rio Itacaiunas
PA
TABELA 14
Generation – Feasibility Studies
Operator
Eletronorte. EDP
Chesf. Queiroz Galvão and Cnec
UHE
Novo Acordo
Castelhano
Chesf. Queiroz Galvão and Cnec
Estreito Parnaíba
Chesf. Queiroz Galvão and Cnec
Chesf. Queiroz Galvão and Cnec
Cachoeira
Uruçui
Chesf. Queiroz Galvão and Cnec
Ribeiro Gonçalves
UF
TO
PI/MA
PI/MA
PI/MA
PI/MA
PI/MA
PE/BA
PE/BA
MT
GO
MW
160
94
56
63
134
113
320
276
46
80
Pedra Branca
Riacho Seco
Juruena
Mirador
MW
10,682
200
Operation
Expected
03/04/2015
19/12/2013
19/12/2013
01/06/2013
14/12/2014
14/12/2014
04/09/2015
14/12/2014
30/07/2013
09/07/2014
Maranhão Baixo
GO
125
03/09/2015
Buriti Queimado
GO
142
03/09/2015
Água Limpa
MT
380
14/12/2014
Chesf. Desenvix and Odebrecht
Chesf. Desenvix and Odebrecht
Eletronorte. Maggi. Linear. MCA
Furnas. PCE. Ener-Tech. Rialma.
Schahin
Furnas. PCE. Ener-Tech. Rialma.
Q,Galvão
Furnas. Rialma. PCE e Queiroz
Galvão
Furnas. ELN. Enercamp. PCE.
Ener-Tech. Alston. A,Gutierrez
35
Annual Report 2008
TABELA 15
Transmission Lines Concluded
Operator
AHE
Eletrobrás/Eletronorte
Belo Monte
Eletronorte. CCCC
Eletronorte. Queiroz Galvão
Marabá
Tabajara
UF
PA
PA
RO
MW Op. Forecast
11,181
30/04/2014
2,160
350
---
---
Eletronorte. CCCC. Alcoa and BHP
Serra Quebrada MA/TO
1,328
30/09/2016
Eletronorte. Maggi. Linear. MCA
Eletronorte. Furnas. Alusa. Q,Galvão
Cachoeirão
Toricoejo
MT
MT
64
76
19/12/2013
19/12/2013
Eletronorte. Desenvix
Torixoreu
PA/TO
408
28/02/2017
TABELA 16
Intesa Consortium: Eletronorte 37% and Chesf 12%
Project
Colinas-Miracema
Miracema-Gurupi
Gurupi-Peixe Nova
Peixe Nova-Serra da Mesa 2
Desterro-Palhoça
Ji-Paraná - P,Bueno- Vilhema C1
Voltage
(Kv)
500
500
500
500
230
230
Operator
INTESA
INTESA
INTESA
INTESA
Eletrosul
Eletronorte
Length
(Km)
173
Operation
Expected
23/05/2008
255
23/05/2008
72
23/05/2008
195
23/05/2008
40
29/12/2008
278
31/10/2008
TABELA 17
Transmission Lines under Construction
Project
Voltage (Kv)
Operator
Milagres - Coremas
Pres, Médice - Santa Cruz I
Campos Novos - Nova Santa Rita
Juba - Jauru
Brasnorte - Nova Mutum
230
230
500
230
230
CHESF
Eletrosul
RS Energia
Brasnorte S,A
Brasnorte S,A
Length
(Km)
120
235
273
121
264
Operation
Expected
31/05/2009
30/09/2009
01/04/2009
10/09/2010
17/09/2009
36
Annual Report 2008
2 – Subsidiary Company Funding
The subsidiary companies and distribution companies received, in 2008, funds in the
amount of R$ 1.3 billion in loans and financing as detailed below:
TABELA 10
Investment
Loans/Financing
Distribution Companies :
Economic
R$ ‘000
Authorized
Financial
R$ ‘000
Total
R$ ‘000
30,800
31,584
21,810
457,488
93,927
17,135
194,935
344,933
113,000
13,259
30,800
31,584
13,559
457,488
93,927
17,135
88,501
292,552
113,000
4,933
1,143,479
1,318,871
Ceal
---
Cepisa
---
Ceron
8,251
Manaus Energia
---
Subsidiaries:
CGTEE
---
Chesf
---
Eletronuclear
Eletrosul
106,434
52,381
Furnas
---
Itaipu
TOTAL
8,326
175,392
37
3 – Stockholders’Participation
Annual Report 2008
The market value of Eletrobrás’ participation in the companies whose shares are traded on
the Stock Exchange was more than R$ 6.1 billion in 2008. The changes in the market value
followed very closely the Electric Power Index (IEE). Eletrobrás portfolio is less volatile than
the market and is characterized, therefore, as a conservative portfolio, with stocks concen-
trated in companies with fixed or regulated income. Even with the unfavorable economic
scenario during the last quarter of 2008, the devaluation of the Eletrobrás portfolio was only
8%, while the Ibovespa index, during the same period, declined by almost 40%. In addition,
the securities that Eletrobrás holds have an excellent chance for appreciation when analyzed
from a long-term perspective.
In 2008 the remuneration from these participations as dividends reached more than R$ 1
billion, one of the largest sources of ordinary funds of the company. The largest part of the
contribution came from the subsidiary companies.
TABELA 18
Dividends / Interest Received in R$ Million
Companies
Subsidiaries
Associate*
Associate
Partnerships
2004
449
53
25
1
2005
2006
2007
2008
463
95
0.1
31
686
189
45
38
378
464
46
169
484
418
57
128
*Associated companies with shares traded on Bovespa
38
VII – Funding
Annual Report 2008
Eletrobrás - Signing a
loan from the
Corporación Andina de
Fomento
(Photo: Jorge Coelho)
40
The Eletrobrás Global Spending Program (PDG) forecast funding needs in the amount of
US$ 1 billion for 2008. Throughout the year, the following operations were realized:
•
•
•
•
Contracting of a syndicated A/B loan from the Corporación Andina de Fomento (CAF).
The loan of US$ 601 million was structured as follows: part A, of US$ 150 million from
CAF, for a period of 12 years; and part B, in the amount of US$ 450 million, from a syn-
dicate of banks led by Citibank, BNP Paribas and Societé Generale, for a period of seven
years. The average rate of interest for the operation was 1.64% over six-month period
LIBOR
Obtain authorization from the Secretary of the National Treasury, valid through the end
of 2009, for an operation in the amount of US$ 400 million as bonds in the international
market.
€37.2
Contracting a loan from Kreditanstalt für Wiederaufbau (KfW), in the amount of
million with the support of the federal government. The funds will be used for the cons-
truction of the São Bernardo complex composed of four Small Hydroelectric Power Plants:
Barra do Rio Chapéu (15 MW), João Borges (19 MW), Itararé (9 MW) and Pinheiro (10
MW), under the responsibility of Eletrosul.
Negotiations with the Inter-American Development Bank and other international finan-
cial institutions for a loan in the amount of US$ 500 million, to be used for the Trans-
formation Plan of the Eletrobrás System and the Investment Program for Distribution
Companies of Eletrobrás.
Annual Report 2008
41
VIII – Corporate Performance
Annual Report 2008
42
(Illustration: Alexandre Wilson
and Julia Goulart)
In 2008, Eletrobrás reported net profit of R$ 6136.5 million, 296% above the results obtai-
ned in 2007, when the company registered net profit s of R$ 1547.9 million. During the fourth
quarter, the net profit was R$ 3038.4 million, 85.35% higher than the positive result during
the same period in the previous year, which reached the amount of R$ 1639.2 million.
The sum of the EBITDAs of the companies controlled by Eletrobrás totaled R$ 6233
million, 79% higher than the value obtained during the same period the previous year, which
was R$ 3483 million. Furnas reported a growth of 212%, from R$ 496 million to R$ 1,546
million; Chesf increased from R$ 2071 million to R$ 2762 million, an increase of 33%; Eletro-
sul (which is still operating only as a transmission company) reported an EBITDA of R$ 413
million, 31% higher than the R$ 317 million reported in 2007; and Eletronuclear reported an
increase of 77%, from R$ 322 million in 2007 to R$ 572 million. The distribution companies
had an increase of 308% in the total value of the combined EBITDA from a negative result of
R$ 341 million in 2007 to a positive amount of R$ 711 million in 2008.
Part of the impressive results of Eletrobrás in 2008 is due to the performance of the dis-
tribution companies of the North and Northeast. In 2007, these companies reported a loss of
R$ 1,172 million, which was transformed into a profit of $ 53 million in 2008, 104.52% higher
than the previous year.
In terms of financial results, the devaluation of the real against the US dollar, and the
fact that Eletrobrás holds receivables in the amount of R$ 16,893 million (US$ 7299 million),
indexed principally against the North American currency, had a positive impact on the results
of the Company, generating a net income of R$ 4,297.1 million as a result of currency rate
variation, against a loss of R$ 3000.5 million in 2007. With regard to monetary variation as a
result of internal changes in prices, the company registered a gain of R$ 997.8 million, against
a positive result of R$ 528 million in the previous year.
Annual Report 2008
43
1. Generation and Transmission
Annual Report 2008
A. SALE OF ELECTRIC POWER
TABELA 19
Companies
2007
2008
MWh
R$ - million
MWh
R$ - million
CGTEE
1,670,547.17
Eletronorte
37,023,340.90
Chesf
Furnas
49,596,126.15
36,388,690.00
*Eletronuclear
11,334,548.00
142
3,595
3,573
2,599
1,356
2,127,335.29
53,130,566.96
50,692,554.83
42,212,472.00
12,851,578.00
195
4,623
4,423
2,645
1,570
Total
136,013,252.22
11,265
161,014,507.08
13,456
ITAIPU HYDROELECTRIC POWER FACILITY
As the Energy Trading Agent of Itaipu (in accordance with Law 10.438, as of 26/04/02),
Eletrobrás transferred to the concessionaires in the South, Southeast, and Center-West Re-
gions a total of 67,902,120 MWh electric power from the power contracted, corresponding to
earnings of approximately US$ 3.2 billion.
The energy supplied above the power contracted and acquired by Eletrobrás was
14,891,612 MWh, corresponding to an income from the Electric Power Sales Committee of R$
360 million.
B. NET PROFITS OF SUBSIDIARIES
TABELA 20
Companies
CGTEE
Chesf
Eletronorte
Eletronuclear
Eletrosul
Furnas
Itaipu
Eletropar
Distributors
Ceal
Cepisa
Ceron
Eletroacre
Manaus Energia
2008
-292,202
1,437,291
-2,424,558
-282,070
268,250
454,518
835,885
10,664
32,487
-98,736
-50,158
152
198,845
2007
-69,149
652,630
-542,315
117,668
196,940
800,222
1,321,590
16,097
-22,704
-81,197
-54,362
4,093
-601,706
44
C. EBITDA
R$ EBITDA
8,029
8,028
7,739
8,541
5,295
2004
2005
2006
2007
2008
D. CAPITAL STRUCTURE AND DEBT
IMAGEM 5
LOANS AND FINANCING - R$ MILLION
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
2004
2005
2006
2007
2008
Payable
Receivable
Annual Report 2008
45
Annual Report 2008
IMAGEM 6
DEBT – R$ MILLION
140,000,000
120,000,000
100,000,000
80,000,000
60,000,000
40,000,000
20,000,000
-
2004
2005
2006
2007
2008
Loans and Financing payable
Other liabilities
Net equity
Loans and Refinancing Granted
TABELA 21
Flow of Financing – R$ ‘000
2009
2010
2011
2012
2013
2014
After 2014
Debt 1,714,611 1,537,342 1,203,083 1,514,850 1,511,167 1,445,406
11,085,716
TABELA 22
Subsidiaries and Itaipu:
Balance on 31.12.2008
Balance on 31.12.2007
CGTEE
Chesf
Eletronorte
Eletronuclear
Eletrosul
Furnas
Itaipu
574,974
3,460,807
7,589,415
2,902,701
592,161
1,178,001
18,416,525
---
4,211,228
6,014,378
2,448,667
186,566
996,262
14,671,171
E. PRIMARY RESULTS
The subsidiary companies of the Eletrobrás System reported outstanding results for their
Primary Results, where the goal, according to Decree nº 6.646, of 18/11/08, was R$ 1,441
million.
46
Annual Report 2008
TABELA 23
Year
2008
2007
2006
2005
2004
Result
Surplus
Surplus
Surplus
Surplus
Surplus
R$ million
2,585
2,783
2,137
2,865
1,650
The independent auditors for each of the companies, were as follows:
•
•
•
•
•
•
•
•
CGTEE – Deloitte Touche Tohmatsu
Chesf – Boucinhas & Campos e Soteconti
Eletronorte – BDO Trevisan
Eletronuclear – HLB Audilink e CIA
Eletrosul – Horwath Tufani e Reis & Soares
Furnas – HLB Audilink e CIA
Itaipu – BDO Trevisan
Lightpar – Russell Bedford Brasil
F – VALUE ADDED
TABELA 24
Distribution of Value Added %
Third Parties
Shareholders
Personnel
Government
2007
26.72
15.05
32.99
25.23
IMAGEM 7
VALUE ADDED – R$ BILLION
11,705
12,279
12,033
10,825
2008
15.43
33.14
20.78
30.65
18,517
2004
2005
2006
2007
2008
47
2. Distribution
Annual Report 2008
A. TARIFF ADJUSTMENT
A contract for concession with the distribution companies calls for an annual tariff adjustment
to protect the concessionaires from the corrosion of the inflationary process. There is, still, a review
of the tariffs every four years, in order to maintain the financial and economic equilibrium of the
session.
The table below shows the tariff rate adjustments for the energy distribution companies in 2008:
25
EDE
Index of Readjustment (%)
Manaus Energia
Ceal
Cepisa
Capital
Interior
Boa Vista Energia
Ceron
Eletroacre
15.05
10.39
12.66
12.19
13.76
12.73
11.19
Period
28/8/08
28/8/08
1/11/08
1/11/08
1/11/08
30/11/08
30/11/08
B. SALE OF ELECTRIC POWER
In comparison with 2007, there was an increase of 15.7% in the amount of electric energy
supplied in 2008. The largest increase took place in the rural areas (93.5%). The main classes
which received the electric energy were residential, industrial and commercial, which together,
represent 76% of the total electric power distributed in 2008.
Amongst the companies with high participation in the trading of electric energy we hi-
ghlight: Manaus Energia, with 37.6% , and Ceal, with 19.8%.
Industrial class is was the most important in Manaus Energia, with 38.8% of the total
electric power traded. For Ceal the most important class was residential, with 36% of the total
supplied.
The large increase in the quantity of electric power supplied in 2008 is due mainly to the
increase in income of the population, the increase in programs for the expansion of the distri-
bution network, such as Light for Everyone, and a decrease of energy losses.
TABELA 26
Consolidated Supply of Electric Power - (GWh)
Class
2004
2005
2006
2007
2008
Residential
Commercial
Industrial
Rural
Other Classes
Total
2,931
1,676
2,214
330
1,405
8,556
3,069
1,847
2,358
380
1,561
9,215
3,146
1,895
2,384
414
1,718
9,557
3,331
2,009
2,465
400
1,561
9,766
3,760
2,218
2,612
774
1,938
11,302
48
Annual Report 2008
IMAGEM 8
BY DISTRIBUTOR
BOA VISTA ENERGIA
Others
24.2%
Residencial 35.6%
Rural
7.7%
CEAL
Others
18.5%
Residencial 35.6%
Rural
1.5%
Industrial
3.4%
Commercial
23.1%
ELETROACRE
Others 22.5%
Industrial
17.0%
Commercial
20.7%
Residential
44.6%
Rural 4.5%
CEPISA
Others 20.8%
Residential 41.6%
Rural 5.1%
Industrial 5.8%
Commercial
22.0%
CERON
Industrial 12.9%
Commercial 20.2%
MANAUS ENERGIA
Others 14.9%
Residential 35.6%
Rural 0.7%
Others 15.5%
Residential 26.6%
Rural 9.8%
Industrial 17.3%
Commercial 22.3%
Industrial 38.8%
Commercial 18.4%
C. CONTROL OF COMMERCIAL LOSSES
In general, the indices of losses declined in 2008, as a result of the efforts realized. Ma-
naus Energia, whose market size and index of losses are the largest among the distribution
companies, was responsible for 45% of the losses.
Among the companies of the greatest reduction in losses, the highlight went to Cepisa,
as it normalized 92,000 unregistered consumer units during the period 2007-2008, and Boa
Vista Energia, whose process of selection of consumer units for inspection took into account
a careful study of statistical analyses of the segment of losses.
Even with declining indices, however, the reduction in losses are still modest, due to limi-
ting factors, such as: precarious knowledge of losses in a segmented and systematic process,
49
Annual Report 2008
precarious knowledge of how to combat losses in the concessionaires combined with a limited
workforce, little integration with other areas involved in a support structure that is insuffi-
cient; and a history of limited investment and technology.
TABELA 27
Boa Vista
Ceal
Cepisa
Ceron
Eletroacre
Manaus Energia
D. DEC/FEC
Technical Losses
(%)
Commercial Losses
(%)
Total Losses
(%)
2007
8.97
12.50
14.00
10.00
8.80
10.90
2008
9.31
8.73
14.17
10.00
8.80
2.90
2007
9.31
18.26
24.46
24.68
17.62
26.30
2008
7.21
21.27
21.97
33.54
17.39
35.80
2007
18.28
30.76
38.46
34.68
26.42
37.20
2008
16.52
30.00
36.14
43.54
26.19
38.70
There were, in general, significant reductions in the indices showing Interrupted Service to
the Consumer (DEC) and the Frequency of Interruptions to the Consumer (FEC). The reductions
reached 11% in the DEC in the case of Eletroacre, and 16% in the FEC recorded by Manaus
Energia (interior).
Nevertheless, only Boa Vista Energia did not manage to achieve the goals for DEC establi-
shed by Aneel for a set of consumers. With regard to the FEC, all of the companies failed to
meet monthly, quarterly or annual targets.
Only Cepisa and Manaus Energia (capital) exceeded the overall targets for DEC. With regard
to FEC, three companies reported amounts higher than the target and only Cepisa reported
results very different from those established by the regulatory agency.
In order to reduce the indices, several actions were taken:
•
Maintenance of the distribution networks with regular tree trimming, network manage-
ment and procedures for the maintenance of the system;
an increase in the number of teams in the operation and maintenance areas;
scheduling of preventive maintenance operations, to minimize the problems in the dis-
tribution lines specifically in areas where it the indices continue to be are precarious;
replacing the conductors in circuits;
construction of new servers;
•
•
•
•
It is important to point out that significant reductions in these indices will require large
investments such as the continuous improvement in the process of preventive maintenance,
expansion of the system and acquisition of systems and network management.
50
Annual Report 2008
TABELA 28
Interruptions and Supplied by Consumer (DEC) – Hour/Year
Boa Vista
Energia
14
15
2007
2008
Ceal
Cepisa
Ceron
Eletroa-
cre
Manaus
Capital
Manaus
Interior
21
20
45
52
38
37
17
15
54
54
94
87
TABELA 29
Interruptions and Supplied by Consumer (DEC) – Hour/Year
Boa Vista
Energia
39
39
2007
2008
Ceal
Cepisa
Ceron
Eletroa-
cre
Manaus
Capital
Manaus
Interior
17
15
37
36
52
46
22
20
32
29
110
93
E. IN DEFAULT ACCOUNTS
Default is a more serious problem for the energy distribution companies of the Eletrobrás
System for specific classes of consumers government, public, industrial and residential service.
In 2008, a decline of 6.7% was recorded in the nominal inventory of payments in arrears
– R$ 1,040 billion, against R$ 1,115 billion in 2007. The companies that made the largest con-
tribution to this reduction were Cepisa, Manaus Energia and Ceal which were responsible for
the decline of 12.5% in payments in arrears. Cepisa was the company that was able to achieve
the largest reduction in its inventory of in default accounts by using a reversal (Provision for
Credits of Doubtful Liquidation), in the amount of R$ 154.2 million, representing a reduction
of 20.8% of the total of payments in arrears. In Manaus Energia the reduction of 2.9% in total
default was due primarily to the reduction of 65.9% of payments in arrears from public service
companies. Ceal reported a reduction of 10.1% in past-due debt, due to negotiations with
Casal in an amount of R$ 66.7 million.
Eletrobrás has made an extra effort to bring the principal structural problems of the distri-
bution concessionaires under control. In this context, corrective measures were taken with the
objective of recuperation of past-due debt. These actions are concentrated, mainly, in cutoffs
of electricity and administrative and judicial collections.
51
Annual Report 2008
TABELA 30
Consolidated Delinquencies For the Distributors – R$ ‘000
Class
2004
2005
2006
2007
2008
Residential
Commercial
Industrial
Rural
Public Authorities
Public Service
Public Illumination
Total
191,550
82,783
82,247
31,571
119,590
157,679
22,586
688,005
196,969
100,064
93,100
33,757
112,707
215,355
28,682
780,634
213,461
101,092
112,288
34,107
123,822
291,974
30,074
906,820
264,616
117,130
150,014
40,824
135,479
372,062
35,269
1,115,394
245,998
125,467
173,203
46,462
143,700
254,116
51,312
1,040,257
IMAGEM 9
BY DISTRIBUTING COMPANY
Boa Vista Energia - R$ mil
CEAL - R$ mil
Residential 4.793
Public
Illumination 356
Commercial 2.274
Industrial 606
Rural 511
Public Service
52.074
Public Authorities
50.600
Manaus Energia - R$ mil
Public Authorities
23.987
Rural 1.370
Public Service
15.127
Public
Illumination
1.239
Industrial 43.331
Commercial
55.063
Residential
128.576
CERON - R$ mil
Public
Illumination
12.233
Residential
23.368
Commercial
12.150
Public Service
47.967
Rural 4.195
Public Authorities
12.945
Industrial 11.452
Public Illumination
13.412
Public Service
70.266
Residential 31.657
Commercial 25.128
Rural 27.224
Public Authorities
25.806
Industrial 64.085
Eletroacre - R$ mil
Public Illumination
3.404
Residential 13.485
Public Service
14.035
Public Authorities
7.436
Rural 1.947
Commercial 5.694
Industrial 1.121
CEPISA - R$ mil
Public Illumination
20.667
Residential 44.159
Commercial 36.910
Public Service
121.568
Public Authorities
22.978
Industrial 40.881
Rural 11.220
52
Annual Report 2008
F. CUSTOMER SERVICE
In 2008, the six energy distribution companies adopted a series of measures taken to fa-
cilitate the contact with their more than 3 million customers in Brazil’s North and Northeast
regions, based on new rules that govern the telephone service centers all over the country.
These new measures included:
•
•
•
•
Increased number of attendants at all call centers;
Installation of new equipment at the call centers;
Special assistance for the hearing and speech impaired (currently being implemented);
New bill issuing system, with portable equipment that allows the professional to print
the bill when reading the consumption meter in the presence of the consumer;
Periodic visits to areas in which there are in default consumers to learn more about the
reality of these customers and create alternatives for regularization;
Registration of consumer units to regularize the situation of energy deviation;
Distribution of brochures on saving electric power;
Development of a virtual handbook that facilitates searches and consultations on the
companies’ websites, eliminating the need for phone assistance in many cases;
Creation of an exclusive relationship channel via a toll-free number for medium to high
voltage energy consumers, with information on supply suspensions and programmed or
emergency interruptions, among others.
•
•
•
•
•
G – EBITDA
TABELA 31
R$ - ‘000
Boa Vista Energia
Ceal
Cepisa
Ceron
Eletroacre
2008
-38,160
133,369
67,114
27,774
22,911
Manaus
Energy
505,909
H – NET OPERATIONAL INCOME
TABELA 32
R$ - ‘000
Boa Vista
Energia
108,652
113,244
Ceal
Cepisa
Ceron
Eletroacre
536,704
637,315
472,245
548,813
444,388
494,802
152,546
154,402
Manaus
Energy
810,290
991,488
2007
2008
I – CHANGES IN NET INCOME/LOSS
TABELA 33
R$ - ‘000
2007
2008
53
Boa Vista
Energia
-8,892
-36,637
Ceal
Cepisa
Ceron
Eletroacre
-22,704
39,487
-81,197
-98,736
-54,362
-50,158
4,093
152
Manaus
Energy
-601,706
198,845
Ix – Capital Market
Annual Report 2008
Eletrobrás – Kick-off of
ADR 2 Trading on the New
York Stock Exchange
54
Annual Report 2008
1. Shareholder Base
On September 25, the 153rd General Shareholders’ Meeting decided on an increase of ca-
pital based on the fourth conversion of compulsory loan in the amount of R$ 202,374,761.75
(two hundred and two million, three hundred and seventy-four thousand, seven hundred and
sixty-one reais and five cents) via the issue of 2,858,588 (two million, eight hundred and
fifty-eight thousand, five hundred and eighty-eight) shares.
Another relevant fact associated with the capital increase was the capitalization of ex-
cess income reserves in the amount of R$ 1,859,401,181.87 (one billion, eight hundred and
fifty-nine million, four hundred and one thousand, one hundred and eighty-one reais and
eighty-seven cents), increasing the Eletrobrás capital from R$ 24,235,828,852.78 (twenty-
four billion, two hundred and thirty-five million, eight hundred and twenty-eight thousand,
eight hundred and fifty-two reais and seventy-eight cents) to R$ 26,156,567,211.64 (twenty-
six billion, one hundred and fifty six million, five hundred and sixty seven thousand, two
hundred and eleven reais and sixty four cents), corresponding to 905,023,527 (nine hundred
and five million, twenty-three thousand, five hundred and twenty-seven) common shares,
146,920 (one hundred and forty-six thousand, nine hundred and twenty) class “A” preferred
shares and 227,186,643 (two hundred and twenty- seven million, one hundred and eighty-six
thousand, six hundred and forty-three) class “B” preferred shares, for a total of 1,132,357,090
(one billion, one hundred and thirty-two million, three hundred and fifty-seven thousand and
ninety) shares.
IMAGEM 10
ELETROBRÁS CAPITAL STRUCTURE ON DECEMBER 2008
Ações Ordinárias
Common Shares
14,68%
4,42%
7,08%
5,04%
14,78%
53,99%
Federal Government
BNDESPAR
FND
FGP
Minority Resident
Minority Non-Resident
55
Annual Report 2008
IMAGEM 11
PREFERRED SHARES
Ações Preferenciais
46.86%
15.48%
37.66%
Federal Government
Resident Minority Shareholders
Non-Resident Minority Shareholders
Participação Total no Capital Social
IMAGEM 12
PERCENT INTEREST IN CAPITAL
13.22%
21.14%
46.26%
3.53%
4.03%
11.81%
Federal Government
FND
Resident Minority Shareholders
BNDESPAR
FGP
Non-Resident Minority Shareholders
56
Annual Report 2008
2. Eletrobrás Share Analysis
The figure below shows in index figures the behavior of Eletrobrás shares and the São Paulo
Stock Exchange (Ibovespa). During a period in which the Ibovespa suffered a devaluation of
41.22%, Eletrobrás common shares (ELET3) increased in value by 8.19% and the preferred
shares (ELET6), by 5.36%.
IMAGEM 13
ELET 3, ELET 6, IBOVESPA AND IEE (DEC 2007 = 100)
ELET 3, ELET 6, IBOVESPA e IEE (Dec 2007 =100)
Jan - Dec 2008
x
e
d
n
I
140
130
120
110
100
90
80
70
60
50
40
ELET 3
ELET 6
IBOVESPA
IEE
ELET–3: Eletrobrás common shares closed 2008 quoted at R$ 25.89 on the São Paulo Stock
Exchange – representing an increase in value of 9.9% compared to the end of 2007, when they
were quoted at R$ 23.55.
ELET–6: Eletrobrás preferred shares closed 2008 quoted at R$ 24.18 on the São Paulo Stock
Exchange – representing an increase in value of 11.9% compared to the end of 2007, when
they were quoted at R$ 21.62.
57
3 – Market Value (R$ Millions)
Annual Report 2008
IMAGEM 14
MARKET VALUE - R$ MILLION
20,753
21,640
28,494
28,929
26,809
2004
2005
2006
2007
2008
58
Annual Report 2008
4 – Rating
With the Brazilian Federal Government as its majority shareholder, the Eletrobrás risk
rating is directly related to the country risk rating. On April 30, 2008, the Standard & Poor’s
rating agency classified Brazil as investment grade. The global sovereign rating closed 2008 at
BBB+ for national currency transactions and BBB for foreign currency.
The Eletrobrás bonds maturing in 2015 closed the year with a BBB rating for foreign
currency transactions. The highest recorded value occurred on October 27 and 28 at 11.29%,
while the lowest, 6.02%, was recorded on June 9.
59
5 – Shareholder and Investor Relations
Annual Report 2008
In compliance with its policy of disclosing information to the market and the rules of Bo-
vespa Corporate Governance Level 1, Eletrobrás holds semi-annual meetings at the country’s
regional Associations of Capital Market Analysts and Investment Professionals (APIMECs): São
Paulo, Minas Gerais, Federal District, Rio de Janeiro and the South and Northeast.
Furthermore, with the objective of introducing the company to foreign investors, the In-
vestor Relations area holds annual meetings (road shows) in Europe and the United States.
60
Annual Report 2008
6 – Shareholder Remuneration
R$ MILLION
1,715
361
2004
442
459
703
2005
2006
2007
2008
61
7 – ADR Program – New York Stock Exchange (NYSE)
Annual Report 2008
Eletrobrás shares were traded on the U.S. over-the-counter market until October 30, 2008
through ADR Level I programs. After this period, both the common shares (CAIFy) and pre-
ferred shares (CAIGy) began being traded on the NYSE under the symbols EBR and EBRB,
respectively.
In 2008, the company’s common shares decreased in value 13.59% (quoted at S$ 11.19)
and the preferred shares, 17.91% (quoted at US$ 10.59), while the Real was depreciated in
relation to the dollar 31.94%.
The graphic below presents the variations of the dollar and ADRs during 2008:
IMAGEM 15
0,30
0,20
0,10
0,00
-0,10
-0,20
-0,30
jan/08
feb/08 mar/08
apr/08 may/08 jun/08
jul/08
aug/08 sep/08
oct/08
nov/08 dec/08
Dollar
CAIFY
CAIGY
62
Annual Report 2008
8 – Latibex – Madrid Stock Exchange
On the Madrid Stock Exchange, the common shares (XELTO) and preferred shares (XELTB)
traded under the Latibex program closed 2008 quoted at € 7.99 and € 7.49, respectively. Due
to the devaluation of the Real, there was a negative variation of 13.3% for the common shares
and of 17.2% for the preferred shares.
The figure below presents the variations of the Euro and shares on the Madrid Stock Ex-
change in 2008:
IMAGEM 16
MONTHLY PERCENTAGE VARIATION
30,00%
20,00%
10,00%
0,00%
-10,00%
-20,00%
-30,00%
63
jan/08 feb/08 mar/08 apr/08 may/08 jun/08
jul/08 aug/08 sep/08 oct/08 nov/08 dec/08
Euro
Xelto
Xeltb
x – Compulsory Loan
Annual Report 2008
Chesf - Santo Antônio de
Jesus Transmission Line
- BA
(Photo: Arquivo Chesf)
64
Instituted to expand and improve the Brazilian electric power sector, compulsory loan
was provided for those industrial consumers with monthly use equal to or higher than 2,000
kWh starting in 1977. The annual sum of these contributions came to constitute book-entry,
nominal and non-transferable credit, always on January 1 of the following year, identified by
the Required Borrowing Taxpayer Identification Code (CICE).
In 2008, continuing its policy of assisting shareholders whose earnings originated from
the capitalization of credits from the compulsory loan, Eletrobrás transferred to the Banco
Bradesco S.A. book-entry system the amount of 5,465,096 (five million, four hundred and six-
ty-five thousand and ninety six) class “B” preferred shares. The amount of R$ 10,560,685.06
(ten million, five hundred and sixty thousand, six hundred and eighty-five reais and six cents)
was sent to the distribution companies to be relent to industrial consumers, referring to in-
terests of credits from the compulsory loan.
Annual Report 2008
65
xI –Sector Funds
Annual Report 2008
Wind Energy Generation
(Photo: José Roberto Almeida)
66
Annual Report 2008
1. Global Reversal Reserves (RGRs)
As manager of the funds originating from the RGRs, Eletrobrás invested a total of R$ 914
million in 2008. The following table shows the transactions associated with the inflows and
investments of these funds.
Inflows and Investments in 2008
TABELA 34
Transactions
Inflows:
Quota Collection
Others
Investments:
Financing
Others
TABELA 35
Region
North
Northeast
Central-West
South
Southeast
TOTAL
Credit Lines
TABELA 36
Program
“Light for Everyone”
Reluz/Conservation
Generation
Transmission
Distribution
Revitalization of Thermal Parks
Others
TOTAL
67
in R$ million
2,816
1,436
1,380
1,719
915
804
%
10.1
23.1
13.0
24.5
29.3
100.0
%
56.2
2.9
9.9
18.3
8.6
0.3
3.8
100.0
Financing Granted - R$ million
92
212
119
224
268
915
Granted – R$ million
514
27
91
167
79
2
35
915
2 – Energy Development Account (CDE)
Annual Report 2008
The Energy Development Account (CDE) was created to compensate the electric power
companies due to the reduction of revenues associated with services provided to the Low In-
come Residential Subclass consumers. In 2008, a total of R$ 2,866 million was granted, with
R$ 1,661 million for Low Income, assisting several different electric power companies, and R$
1.206 million for the “Light for All” Program, as shown in the table below.
Inflows and Investments in 2008
TABELA 37
Transactions
in R$ million
Inflows: CDE+UBP+Aneel Fines:
Quota Collection
Others
Investments:
“Light for Everyone” Grant-in-Aid
Low Income Grant-in-Aid
Others
3,532
2,583
949
3,546
1,205
1,661
680
68
Annual Report 2008
3 – Fuel Consumption Account (CCC)
The Isolated System Fuel Consumption Account (CCC-Isol) is a sectorial fund managed
by Eletrobrás designed to cover part of the expenses incurred from the acquisition of fossil
fuels used to generate electric power at thermoelectric power plants that are not integrated
with Brazil’s National Interconnected System (SIN), located primarily in country’s Northern
region.
In 2008, Eletrobrás implemented a series of measures to improve CCC management, inclu-
ding the following.
Em 2008, a Eletrobrás implementou uma série de medidas visando à melhoria da gestão da
CCC, dentre as quais se destacam:
•
•
•
Improvement of Fuel Stock Monitoring (AEC) in order to optimize controls over the phy-
sical transport of fuels at the Isolated System thermal plants;
Improvement of the Isolated System Monthly Operation Program (PMO), with the in-
clusion of controls that help preserve the integrity of planning processes and improve
operation monitoring in Isolated Systems;
Development of an information system, with the participation of the Eletrobrás IT area,
to create the two procedures cited above within the institutional sphere which aims at
boosting reliability and integrating procedural routines.
Also included in the fund coverage scope are the payments for ventures that obtained the
subrogation of the CCC-Isol benefits. The payments cover part of the costs with actions desig-
ned to achieve current or future cost effectiveness of the bill, as well as replace oil derivatives
with other sources of electric power generation.
In 2008, the Annual Fuel Plan established an annual quota of R$ 3.531 billion for such
payments associated with fuel oil costs, plus R$ 145 million associated with State Value-Added
Tax (ICMS). The estimated cost of the ventures subrogated to CCC was added to this total,
in the amount of R$ 155 million. This produced a total of R$ 3.831 billion, which based on
the positive balance in the account associated with the previous year (approximately R$ 35
million), totaled an estimated amount of R$ 3.796 billion for 2008.
The generation indicated by the North Region Technical Operational Group (GTON) to be
produced in 2008 was 9,723,764 MWh, with the consumption of 730,000 tons of fuel oil,
225,000 tons of PGE oil, 826 million liters of diesel oil and 854 million liters of PTE lightwei-
ght oil.
69
xII – Government Sector Programs
Annual Report 2008
Eletrobrás - RELUZ -
Physical Supervision of
Procel Reluz
(Eletrobrás Archive)
70
Annual Report 2008
1 – National Program for Efficient
Public Illumination (Reluz)
Responsible for 3.2% of the national electric power consumption, public illumination is the
focus of Procel Reluz, whose goal until 2010 is to invest R$ 2 billion to ensure the efficiency of
five million public illumination points and install one million new points in the country.
In 2008, Reluz undertook 15 municipality projects, restoring efficiency to more than
112,000 points.
The result was energy savings of 20.1 MWh/year and a 4,600 kW reduction in demand. The
program also installed 218 new efficient points. The investments totaled R$ 34.4 million, with
Eletrobrás financing R$ 25.8 million of this amount.
Reluz assisted 15 municipalities in 2008, making 112,000 points more efficient, resulting
in energy savings of 20,100 MWh/year and a 4,600 kW reduction in demand. The program
also installed 218 new efficient points. The investments totaled R$ 34.4 million in 2008, with
Eletrobrás financing R$ 25.8 million of this amount.
Resource Use per Region
TABELA 38
Region
C. West
North
Resources/R$ millions
10.199
0.527
North-
east
---
South
0.393
South-
east
23.282
TOTAL
34.401
Resultados efetivos por região – número de pontos
TABELA 39
Region
C. West
North
*Number of Points
33,087
218
North-
east
---
South
479
South-
east
78,874
TOTAL
112,658
*Number of points associated with the implementation of the efficient public lighting expansion project
Resultados efetivos por região – redução na demanda
TABELA 40
Region
C. West
North
North-
east
South
South-
east
TOTAL
Reduction/demand
1,047.80
---
---
46.5
3,485.40
4,579.70
71
2 – National Program for Electric
Energy Conservation (Procel)
Annual Report 2008
Designed to promote the efficient use of electric power and combat its waste, Procel in-
vested approximately R$ 40 million in 2008, including funds from the Global Reversal Reserves
(RGRs). The program developed projects that helped save an estimated 4,100 GWh – equi-
valent to the annual electric power consumption of approximately 2.4 million homes. Such
savings represent a postponement of investments totaling R$ 2.71 billion.
Estimated Energy Savings (2001-2008)
IMAGEM 17
PROCEL – ENERGY SAVED - GWH/YEAR
Eletrobrás – Inauguration of
the “Casa Genial Porto Alegre”
(Photo: Jorge Coelho)
4500
4000
3500
3000
2500
2000
1500
1000
2001
2002
2003
2004
2005
2006
2007
Eletrobrás – 2008 Procel Seal
(Photo: Jorge Coelho)
Instituted in 1993, the Procel Energy Saving Seal is designed to indicate to the consumer
the most efficient household appliances and equipment in their categories each year. The seal
is granted as part of a joint effort between Eletrobrás/Procel and the National Institute of Me-
trology, Standardization and Industrial Quality (INMETRO) Brazilian Labeling Program (PBE).
In 2008, the Procel Seal was granted to 2,402 different models and 137 different com-
panies distributed into 23 equipment and household appliance categories. The categories of
ceiling fans and sodium vapor lights were included.
72
Annual Report 2008
3 – Incentive Program for Alternative
Sources of Electric Energy (Proinfa)
Proinfa advocates the diversification of the Brazilian energy matrix, supporting ventures
based on wind energy, small hydroelectric power plants (SHPs) and biomass. Besides promo-
ting the use of local energy sources, Proinfa helps generate 150,000 direct and indirect jobs,
provides large industrial demands and promotes the internalization of cutting-edge techno-
logy.
With the conclusion of all ventures, the program will help reduce greenhouse gas emissions
by approximately 2.8 million tons of CO2 equivalent/year.
In 2008, 31 projects started commercial operation as part of Proinfa, five of which were
wind-based (90.90 MW), 25 SHPs (498.60 MW) and one biomass thermal-based (5.00 MW),
increasing the national electric system’s power by 594.50 MW.
In all, Proinfa has already installed 69 plants, increasing the country’s installed capacity
by 1,580.68 MW.
TABELA 41
Sources
TABELA 42
Sources
PCH
Eólica
Biomassa
TOTAL
PCH
Eólica
Biomassa
TOTAL
Ventures that Began Operating
in 2008
Operating Power (MW)
Ventures Operating up to
12/31/08
25
5
1
31
39
11
19
69
Operating Power (MW)
498.60
90.90
5.00
594.50
766.94
309.40
504.34
1,580.68
73
4 – National Program for Universal Access to Electric
Power (“Light for Everyone”)
Annual Report 2008
The goal of the “Light for Everyone” Program is to bring electric power to 10 million people
residing in Brazil’s rural regions. In 2008, the program built 441,427 new connections, accu-
mulating a total of 1,877,362 connections – corresponding to more than 9.3 million people
assisted.
A total of 55,987 projects were registered for a total of 248,808 projects since 2004, inclu-
ding the following: connections to rural homes in 5,174 Brazilian municipalities:
•
•
•
•
the construction of 330,779 kilometers (205,536 miles) of high and low voltage elec-
trical networks;
the installation of 3.4 million poles;
the installation of 509,503 transformers;
the installation of 2,046
Funds Contracted and Granted up to 12/31/08 – Per Region
TABELA 43
Region
North
Northeast
Central-West
Southeast
Southeast
Brazil
Accumulated Sums up to 12/31/08 (R$ million)
Funds Contracted
Funds Granted
CDE
1,812
3,810
498
671
315
RGR
CDE+RGR
207
681
414
916
391
2,019
4,491
912
1,587
706
CDE
1,178
2,569
355
468
200
RGR
CDE+RGR
147
485
301
610
203
1,325
3,054
656
1,078
403
7,106
2,609
9,715
4,770
1,746
6,516
74
TABELA 44
Region
North
Northeast
Central-West
Southeast
South
Total
Connections Contracted up to 12/31/08 between Operators and
Eletrobrás
338,691
1,017,438
140,538
348,458
151,836
1,996,961
It is also important to point out that in 2008, the program also began to step up its efforts
to develop rural electrification projects prioritizing the use of renewable energy sources.
In this sense, of particular importance was the pilot project installed by Eletroacre, which
involved the participation of Eletrobrás, in the municipality of Xapuri in Acre, where 103 in-
dividual photovoltaic systems were installed at the Iracema, Dois Irmãos and Albrácea rubber
plantings.
Annual Report 2008
75
xIII – Program for Technological and
Industrial Development (PDTI)
Annual Report 2008
Cepel – Advanced Supervision
and Control Laboratory
76
(Photo: Sebastião Pinheiro)
Annual Report 2008
1 – Research & Development (R&D)
Itaipu – Electric Vehicle
Research, Development and
Assembly Center
- Photo: Alexandre Marchetti
In compliance with Brazil’s National Electric Energy Agency (Aneel) regulations, the gene-
ration and transmission companies must invest 0.4% of their net operational revenues in R&D,
and collect another 0.4% for the Ministry of Science and Technology as a contribution to the
National Scientific-Technological and Industrial Development Fund, and an additional 0.2% for
the Ministry of Mines and Energy to support the Brazilian energy system expansion planning
studies undertaken by the Energy Research Company(EPE).
Distribution companies must direct 0.2% of their net operational revenues at R&D, 0.2%
to the National Scientific-Technological and Industrial Fund, 0.10% to the Ministry of Mines
and Energy and 0.5% for energy efficiency.
The holding company directs 0.5% of its capital toward the Technological Development
Fund (FDT) each year. Of this sum, the most significant portion (from 60 to 70%) assists the
Electric Energy Research Center (Cepel).
In 2008, the Eletrobrás System invested R$ 124.7 million via Aneel R&D and R$ 139.6
million in Cepel projects, for a total of R$ 264.3 million. The company also collected R$ 44.9
million for the Ministry of Science and Technology and R$ 26.2 for the Ministry of Mines and
Energy / Energy Research Company.
At Cepel, 105 corporate projects were development in the area of Research, Development
and Innovation for Eletrobrás System companies focused on the following topics:
Generation Expansion Planning (4);
Environment (4);
Stochastic Hydrology and Water Resources (3);
Operation Planning (5);
Transmission Expansion Planning (2);
Network Planning, Operation and Analysis (9);
Scada/EMS Technologies(8);
Local Automation and Disturbance Analysis (2);
Transmission Technology (11);
Metallurgy and Materials (7);
Equipment and Installation Monitoring and Diagnosis (17);
Energy Conservation and Efficient Use (14);
Distributed Generation (6);
Electric Measures and Loss Prevention (4);
Renewable Energies (3);
Computational Techniques and Methodologies (3);
Financial Analysis of Projects and Rates (1);
Reliability (1);
Energy Quality (1).
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
In terms of the actions undertaken directly by Eletrobrás, the Corporate Project Depart-
ment continued to develop the agreement portfolio associated with R&D, including a partner-
77
ship with the Study and Project Financing Company (Finep) and others fully supported by the
Technology Board.
Among the projects concluded in 2008, one of special note was the “Alagoas State Wind
Atlas,” developed by the Technology Institute for Development (Lactec) and the Federal Uni-
versity of Alagoas (Ufal), whose results will serve as the basis for determining future invest-
ments in
wind energy projects for that state.
Also of special importance was the restructuring of the Technology Board in 2008, inclu-
ding a Technological Management area that will plan and prioritize the company’s Research,
Development and Innovation (P&D+I) actions and energy efficiency initiatives for the
system companies.
Annual Report 2008
78
Annual Report 2008
2 – Standards and Quality
•
•
•
•
•
As part of the NBR 19000 Project, the company performed six quality audits within the
sphere of the “Audit Program for Breakers” and two within the sphere of the “Metal
Structure Audit Program.” It also held a presentation in order to publicize the NBR 19000
Project to the electro-electronic industry, as well as an in-company Leading Quality Au-
ditor course with aims at training leading auditors for the project.
The Standard and Quality Department coordinates the task force that is currently ela-
borating the Eletrobrás System Quality Policy for Suppliers. This policy is one of the
Eletrobrás System Transformation Plan projects within the sphere of the Corporate Mana-
gement Model Reorganization initiative.
As far as the ISO 9001 certification, the Standard and Quality Department maintained the
certification of its processes after the audit performed by BRTÜV.
A group coordinated by Eletrobrás elaborated the Brazilian Standards for Aerogenerators
at the Brazilian Association of Technical Norms(ABNT), a process that was based on the
International Electrotechnical Commission (IEC) international standards.
Activities were developed through the coordination by Eletrobrás on Sub-Committee 1
of the TC 176 Technical Committee – ISO Quality and in groups at ABNT/CB-25- Quality
and CB-38-Environmental Management.
79
xIV – Social Dimension
Annual Report 2008
Eletrobrás - Celebration Of
46 Years of Eletrobrás – Rio
de Janeiro Municipal Theater
Symphony Orchestra
(Photo: Jorge Coelho)
80
Annual Report 2008
1 – Personnel Management
Starting in March 2008, when the Brazilian federal government oriented the company to
transform and strengthen its operations, the unification of the Personnel Management policies
became one of the key tools of the Eletrobrás System Transformation Plan.
In order to meet the existing demands and achieve a modern, competitive and profitable
positioning for the holding company and its subsidiaries, task forces were created for the
discussion, unification and implementation of best practices and policies.
As part of the policy unification, the company constituted the Task Force for Personnel
Management, consisting of managers from the Personnel Management areas of each company
under the coordination of Eletrobrás. Aiming at elaborating an Eletrobrás System Integrated
Personnel Management Plan, the Task Force was divided into three sub-groups dedicated to
the following topics: Career and Remuneration; Evaluation and Performance; Personnel Admi-
nistration; and Benefits, Employment Health and Safety.
The work in process is designed for the implementation of the Eletrobrás System Career and
Remuneration Plan, with the following definitions:
•
•
•
Career Structure – Standardization of the career advancement figures (horizontal and
vertical) and criteria for evolution.
Position Structure – Levels of complexity, management and advisory positions and non-
management positions.
Salary Structure – Standardization of salary tables, ranges of complexity levels and po-
sition remuneration.
With this initiative, Eletrobrás hopes to reduce the existing distortions between compa-
nies, eliminate gaps between the competencies required by the work processes and the com-
petencies of employees, allowing for the most efficient possible allocation of professionals
to thereby facilitate interaction between the Personnel Management areas at all Eletrobrás
System companies.
The Eletrobrás Communication area – in partnership with the Personnel Management, So-
cial Responsibility and Health areas, among others – also undertook a series of actions direc-
ted at its internal public. Such actions were planned to inform and motivate employees about
company affairs, their own accomplishments, their current and future challenges and the
importance of the entire Eletrobrás team’s participation in the transformations underway.
Five Eletrobrás System Transformation Plan (PTSE) presentation events were organized
for all system employees, gathering more than 26,000 people. During these meetings, the
president of the holding and the general coordinator of the presidency presented the actions,
projects and first results of the plan.
The company also launched the Transformation Portal, where the internal public can find
information on this plan, monitor the performance of the 41 projects underway and send
questions via a channel created to answer questions.
Another Communication action focused on the internal public was the SOX Project Support
Integrated Communication Plan, replicated for the entire Eletrobrás System and divided into
81
three stages. In the first of these, the Communication area developed the understanding and
importance of implementing the SOX Project, guaranteeing the necessary information with
the scope to reach all internal relationship stakeholders. During a later phase, the goal was
to seek the engagement and commitment of all those involved, monitoring their performance,
and during a third phase, the plan will work to promote the continuity and consistency of the
SOX process in the Eletrobrás System.
Eletrobrás (the holding company) currently has 1,002 employees. In 2008, 160 job po-
sitions were filled through the public sector recruitment examination associated with the
selection processes completed in 2005 and 2007. The company also signed an apprenticeship
agreement with the 36 youth approved by the Youth Apprentice Program selection process,
which involves all companies of the Eletrobrás System in a single technical cooperation agre-
ement with the approval of the Ministry of Mines and Energy and Ministry of Labor and Em-
ployment.
IMAGEM 18
22.6
22.5
23.4
2004
2005
2006
27.6
2008
22.6
2007
A – HEALTH, WELL BEING AND JOB SAFETY
In order to consolidate and expand the initiatives designed to protect its employees,
Eletrobrás has maintained an Ergonomics Committee since 2007 and also uses an Eletrobrás
Installation Emergency Plan to guarantee safety in the case of risks. In 2008, the committee
implemented workplace exercises, encouraging employees to add to their daily routine practi-
ces beneficial to their physical and mental health.
Other important actions developed during the year also included:
•
Acquisition and distribution of Personal Protection Equipment (PPE) kits to all company
employees;
A total of 145 classifications in hazardous work conditions/electrical risk reports for 100
professionals involved in risky activities;
Elaboration of fire protection reports and electrical installation conformity reports for
all Eletrobrás facilities;
•
•
Annual Report 2008
82
Annual Report 2008
Eletrobrás - Cúpula do Theatro
Municipal do Rio de Janeiro
83
•
•
•
•
Completion of 1,389 occupational medical exams; 5,419 medical and occupational nur-
sing appointments and 3,539 social service appointments;
Application of 828 flu vaccine doses and 331 doses of other vaccines;
The Healthy Eletrobrás Program, with actions designed to promote employee health
and prevent diseases, divided into the sub-programs of Heart Health, Eating Habit Re-
education, Attention to Tobacco Addiction, Energy and Movement, Travel Medicine and
Women’s Health;
Commemorative dates in the health area, such as “Eye on Health,” with health tips and
precautions for a healthy Carnival celebration; Combating Dengue Fever; Health and
Nutrition Day; World Tobacco-Free Day; Eye Health Day; Cholesterol Reduction Day; World
Alzheimer’s Day; World Heart Day; Worth Dental Hygiene Day; World Diabetes Day; and
World AIDS Day.
B – TRAINING AND DEVELOPMENT
Eletrobrás has continuously developed means and resources that guarantee improvements
in its employees’ skills. More than merely fulfilling the applicable requirements and legisla-
tion, the company mobilizes efforts to invest in the individual and collective growth of its
work force. Proof of this can be found in the Corporate University of the Eletrobrás System
(UNISE), the greatest symbol of our quest for excellence.
UNISE is part of a corporate education project designed to transform the employee’s pro-
fessional growth into a competitive advantage for the sector. The courses are offered to all
System employees based on distance learning techniques – with online resources and video-
conferences – as well as on-site courses.
In 2008, UNISE trained a total of 599 employees, including:
•
•
•
three new employee orientation groups, involving the participation of 359 employees;
a short duration distance course for five employees;
on-site training sessions, with courses on “Agreement Management,” “Joint Selective
Collection,” “Press Relations (DE)” and “Administrative Disciplinary Process.”
The company also launched the Distance Training System (LMS) and the Basic Course
in Energy Efficiency for Procel. As part of the Eletrobrás System Transformation Plan, the
company began a joint project to elaborate an Integrated Personnel Training Plan that gives
companies the qualifications they need to meet for the new strategic orientations produced
by Eletrobrás’ growth. UNISE is currently being remodeled to serve as the main instrument in
the implementation of this plan.
In all, the company invested R$ 2,928,478.63 in Training and Development in 2008, gene-
rating opportunities for 2,968 employees.
Annual Report 2008
TABELA 45
Training and Development - 2008
Long Duration
Short Duration
Corporate TV
Languages
Seminars and Conferences
Totais
No. of
Courses
31
313
4,600
204
84
5,232
Employees
H/h
82
10,060
2,461
1,000
204
221
8,139
n/a
19,584
1,938
3,968
39,721
Costs Involved
R$ ‘000 you
332
1,070
480
656
390
2,928
C – LABOR AND TRADE UNION RELATIONS
The 2008/2009 Collective Work Agreement established the following:
•
For the controlled companies – a salary readjustment of 6.61% and a bonus not incorpo-
rable to the salary corresponding to 7.5% of a salary, plus a fixed amount of R$ 2,000.
For the distribution companies – a salary readjustment of 5.04% and a bonus not incorporable
to the salary corresponding to 7.5% of a salary, plus a fixed amount of R$ 1,000.
Over the long term, the Eletrobrás System Transformation Plan has been developing a
process to unify the advantages and benefits offered to employees, as previously men-
tioned.
•
•
Eletrobrás – “Hands On” Project
(Photo: Jorge Coelho)
84
Annual Report 2008
2- Community and Society Relations
A – SOCIAL RESPONSIBILITY
There are currently no doubts that economic growth goes hand-in-hand with social de-
velopment. Even due to the very nature of its business, the Eletrobrás System understands
social issues to represent an expressive part of its mission. This is reflected in the alignment
of its management practices, in its set of organizational values and in the transversality of its
electric energy programs.
•
Corporate Citizenship
The operations of the Eletrobrás System Sustainability Committee, with task forces fo-
cused on the three dimensions of Sustainability (triple bottom line: economic-financial,
social and environmental), contributed heavily to Eletrobrás’ inclusion in the 2008 Bo-
vespa ISE, whose evaluation criteria also include the corporate governance dimension.
•
Diversity
The search for equal opportunities for all people, regardless of their sex, race, ethnicity,
age, sexual orientation, social origin or physical or mental capacity, is a commitment
assumed by Eletrobrás aiming at eliminating any type of discrimination.
The company’s work promoting diversity and protecting human rights is present in its
social responsibility actions, highlighting its receipt of the 2008 Gender Pro-Equity Seal
granted by the Special Department of Policies for Women (SPM). Within the Eletrobrás
System, Cepel, Ceal, CGTEE, Eletronorte, Eletronuclear, Eletrosul, Furnas and Itaipu Bina-
cional also received the seal.
•
Joint Selective Collection
In compliance with Federal Decree 5940/2006, Eletrobrás donates the recyclable waste
generated at its facilities to cooperatives or recyclable waste collectors’ associations. The
program is designed to generate income and promote social inclusion for the collectors, as
well as strengthen the global debate on sustainable development, the reduction of waste
sent to the landfills and garbage dumps and the minimization of environmental impacts.
•
Social Projects
Eletrobrás maintains permanent channels of communication, dialogue and negotiation
with society and with the communities in which it operates, aiming to contribute with
solutions for the social problems affecting the population segments considered to be at
social risk and directing resources for the support and development of the social projects
demanded by society.
•
Community Production Centers (CCPs)
With aims of promoting the integrated and sustainable development of the rural com-
munities assisted by the “Light for Everyone” Program, the company also helped create
the Community Production Centers (CCPs), facilitating the production, processing and
sale of local products.
In 2008, two more of these centers were inaugurated: CCP Santana do Taquaral (manioc
flour production), located in the Municipality of Santo Antônio do Leverger (MT); CCP Rio
Itaipu – Science Station
– Interactive Scientific
Education Center
(Photo - Alexandre Marchetti)
85
Annual Report 2008
Bonito (bovine milk cooling and processing), located in the Municipality of Nova Ubiratã
(MT). Professionals from the Engineering Board performed the initial technical-economic
feasibility analysis for these centers.
TABELA 46
2008 ExTERNAL SOCIAL INDICATORS – R$ ‘000
Education
Health and Infrastructure
Income and Work Generation
Investments Dedicated to Environmental Education for the Community
TOTAL INVESTED DURING 2008
1,584
3,299
566
200
5,649
B - SPONSORSHIP
In 2008, Eletrobrás launched its first call for the public selection of cultural projects.
The Eletrobrás Culture Program focused its sponsorship on theater projects, which will be pre-
sented during 2009.
It invested R$ 26.5 million in 86 projects. The emphasis, following tradition, was on theater,
but it also supported other forms of scenic arts, integrated arts, preservation of cultural heritage
and regional folklore, in addition to different music events and festivals, art exhibits, films, books
and CDs. The company also signed an agreement to revitalize the Rio de Janeiro Municipal Theater,
which completes 100 years in 2009.
All categories and age groups of Brazilian basketball continued to receive Eletrobrás’ official
support in 2008. The company invested R$ 12.8 million in sports projects and events and also
supported the Brazilian Wheelchair Basketball Federation, helping the country send the men’s and
women’s national teams to the Paralympics in Peking.
C- COMMUNICATION
The Eletrobrás System Transformation Plan initiated a period of major challenges for the
Communication area. The activity adopted a strategic role in terms of achieving the goals
established by PTSE.
In order to prepare itself for the new challenges, it elaborated the first System Integra-
ted Communication Policy. The implementation of this policy will consolidate the holding
company’s permanent commitment to orienting and integrating the actions of the Eletrobrás
System companies during the Communication process definition and implementation phases.
This document will indicate the guidelines for investments in this area, considering all the
orientations of the Eletrobrás System Strategic Planning.
In 2008, Eletrobrás also renewed efforts toward reinforcing its institutional image, promo-
ting three major publicity campaigns – Institutional, Anniversary and PAC –, involving a total
investment of R$ 18.2 million, in addition to one-time campaigns held to take advantage of
opportunities in strategic media publications. The company invested R$ 5.2 million in these
campaigns.
86
Annual Report 2008
Chesf – Swimming Classes for
Low-Income Children
(Photo: Severino Silva)
D – OMBUDSMAN
Since 2005, the Eletrobrás General Ombudsman has established a permanent communica-
tion channel between the top management of the company, its employees and society in order
to process complaints, reports of possible illegal activity and information requests, among
others.
The people interested can send messages to the Ombudsman via e-mail by using the link
on the Eletrobrás homepage, or via fax, letter, phone or in person. In addition to the Ombuds-
man Channel, individuals can direct their messages at the Gender Channel, which is designed
for complaints associated with any type of discrimination, and the Report Channel, designed
to receive reports of possible accusation that may interfere with the company’s accounting
results.
In 2008, the company achieved some important results. Internally, the Ombudsman pro-
cess was entirely computerized through the implementation of the Ombudsman Management
System (SOU). This system began to protocol the receipt of the complaints, allowing the mo-
nitoring of the internal formalities and thereby reducing the demand response time.
IMAGEM 19 / IMAGEM 20
3,056
2,380
Underway
Em Andamento
22%
22%
Total
Resolved
Resolvidas
Resolved
78%
78%
To permanently consolidate this topic among the Eletrobrás System companies, Eletrobrás
held the 2nd Ombudsman Meeting, designed to strengthen the conceptual and operational
alignment of the Eletrobrás System (SE) Ombudsmen, as well as plan actions together with
the holding company Ombudsman. To ensure integrated actions, the Eletrobrás Ombudsman
promoted the installation of Ombudsman management software (SOU) at 11 companies of the
Eletrobrás System.
As part of the strategy for installing Ombudsmen at all the Eletrobrás System companies,
the companies Furnas, Eletronuclear and Chesf structured their operations and received the
SOU system and training for their teams through the Eletrobrás Ombudsman. This development
is part of a set of actions designed to improve transparency in company management and ful-
fill the ISE Bovespa, New York Stock Exchange (NYSE) and SOX sustainability criteria.
87
xV – Information Technology
Annual Report 2008
Eletrobrás – Data Processing
Center at Eletrobrás
(Photo: Jorge Coelho)
88
In order to ensure the fulfillment of the new challenges posed for the Eletrobrás System,
as well as the guidelines established by the Transformation Plan, the company is currently
elaborating an Integrated Information Technology and Communication Policy (TIC).
The main objective of the plan is to increase the System companies’ level of TIC gover-
nance maturity, helping to improve corporate performance through the sharing of resources
and gains of scale, and align the business processes with the strategies established by the
System.
The preparation of the TIC Integrated Policy is coordinated by the Information Technology
Committee (COTISE), a permanent committee with representatives from all Eletrobrás System
companies. The actions that should be guaranteed by the Policy
include:
•
•
•
•
•
•
•
the interoperability of the company’s information systems;
the exchange of information systems;
the unification of equipment acquisitions,
software, telecommunication circuits, technical training courses and TIC services;
mutual technical support between TIC areas;
the use of standardized systems;
the standardization and integration of: work processes, organizational structures,
work methodologies, norms and procedures, professional training plans, telecom-
munications technologies and hardware and software platforms.
Annual Report 2008
89
xVI - Environment
Annual Report 2008
Chesf - Sobradinho
Reservoir - BA
(Photo: Severino Silva)
90
Annual Report 2008
Respect for the environment is one of Eletrobrás main trademarks. A significant part of the
nature of the company’s business - socio-environmental issues - is reflected in the alignment
between its management practices and support for external projects. Aiming to ensure action
that is unified, continuously improved and adjusted to comply with applicable law, Eletrobrás
develops activities in the environmental area together with the companies of the Eletrobrás
System, implementing a work agenda that involves issues of common interest.
To ensure interaction between the companies and the definition of common guidelines,
Eletrobrás coordinates a specific forum for the environmental areas of the System companies
– the Environment Subcommittee (SCMA). In 2008, this forum and its nine task forces held 29
meetings, addressing topics such as: use of the edges of hydroelectric power plan reservoirs,
environmental legislation and costs, environmental communication management, greenhouse
gas emissions and aquatic resources.
During the year, the company implemented the following projects and respective activi-
ties, among others:
Destacaram-se, ao longo do ano, os seguintes projetos e respectivas atividades:
•
AHE Belo Monte: revision and complementation of the Environmental Impact Studies; on-site
inspections; presentation of the project at local and regional courts; interaction with the
affected populations in order to better understand their needs; presentation of partial results
to the Brazilian Institute of Environment and Renewable Natural Resources (IBAMA); deve-
lopment of anthropological studies; meetings with FUNAI; and the complementation of the
Integrated Environmental Assessment for the Xingu River Basin.
AHE Garabi (Brazil/Argentina): Elaboration together with Argentina’s Bi-national Power
Undertakings Inc. (EBISA) of the Terms of Reference and call for tender for contracting
the Uruguay River Hydroelectric Inventory Studies along the stretch of border between
Brazil and Argentina; holding of the bidding process.
AHEs Paquitzapango, Sumabeni, Urubamba, Cuquipampa and Vizcatan (Peru): elabora-
tion of the Terms of Reference for pre-feasibility studies.
AHE Baynes (Angola/Namibia): monitoring of the elaboration of the Term of Reference
for the pre-feasibility studies.
•
•
•
Como gestora dos contratos de compra e venda de energia firmados no âmbito do Proinfa, a EAs
the manager of the agreements related to energy sale and purchase signed within the sphere of
PROINFA, Eletrobrás is also permanently responsible for the environmental monitoring of the 144
ventures included in the program. In 2008, it issued 82 conformity reports. As part of the Isolated
System Operation Program management, the company identifies and evaluates the main environ-
mental issues associated with the thermal parks and their surrounding areas.
During financing decisions, the environmental dimension is always considered, with pre-
vious environmental assessments of the projects and the monitoring of their progress. Envi-
ronmental topics are also inserted into the R&D projects in partnership with universities and
research centers.
All of these activities, which are completed routinely, will be continued over the upcoming
years.
The company also plans to implement the following additional actions:
•
elaboration and issue of the greenhouse gas inventory for the Eletrobrás System thermo-
electric power plants for the period from 2006 to 2008;
structuring of a virtual library with technical-scientific production from the Eletrobrás
System companies in the environmental area;
establishment of a set of socio-environmental performance indicators and the imple-
mentation of a database containing information related to the indicators to subsidize
the evaluation and communication of socio-environmental performance improvements
among the Eletrobrás System companies.
•
•
91
xVII – Awards and Recognition
Annual Report 2008
92
Annual Report 2008
Alexandre Theme, from the
Eletrobrás Social Responsibility
area (to the left) receives the
SustentaX Seal, Gold Category, at
the 2nd FIESP Socio-Environmental
Responsibility Exhibit, held in
August
(Photo: Jorge Coelho)
93
From social and environmental projects for business transparency, the Eletrobrás System
companies were recognized in 2008 for their initiatives in the electric power market.
For the second consecutive year, the Eletrobrás System was listed on the Bovespa Corpo-
rate Sustainability Index (ISE) as recognition of its commitment to the three dimensions of
Sustainability: economic-financial, social and environmental.
The holding company received yet another “Assiduity Seal,” granted by the São Paulo
Association of Capital Market Analysts and Investment Professionals (APIMEC), and its booth
at the 2nd Federation of Industries of the State of São Paulo (FIESP) Socio-Environmental
Responsibility Exhibit was certified with the SustentaX Seal. Within the sphere of Institutional
Image, the company earned gold in the “12th O Globo Advertising Award,” in the Online Media
category, and silver at the 16th Gramado International Advertising Festival.
Also awarded for disclosing business-related information, Eletronorte won the Transpa-
rency Trophy for the second consecutive year. For the fourth consecutive year, the magazine
Isto É Dinheiro elected Eletrosul the country’s top electric power company.
The quality of the company’s customer assistance was highlighted at Boa Vista Energia –
the company received the ANEEL Consumer Satisfaction Rate Award. In Itaipu, it was awarded
in the area of tourism: the
Tourism Complex was elected a “2007 National Tourism Attraction” by the magazine Brasil
Travel News and received the Abav-Paraná Distinction Award for developing tourism attrac-
tions with social responsibility. The company was also one of the distinguished companies in
the Tourism Social Responsibility award promoted by the Brazilian Ministry of Tourism.
In the area of Social Responsibility, Eletronuclear received the 2007 CREA-RJ Social Res-
ponsibility Seal in recognition of the Pomar Project – Marine Repopulation of the
Ilha Grande Bay (RJ); for the fourth consecutive year, Furnas earned the Mogi News –
Chevrolet Alto Tietê Social Corporate Responsibility Award for the social project “Qualify with
Energy.” CGTEE won the 16th Ecology Expression Award in the “Socio-Environmental Technolo-
gies” category for the project “Organic Fruit Gardens: Contribution to Food Security in Rural,
Indigenous and Urban Areas.”
Eletrobrás also received the Gender Pro—Equity Seal granted by the Special Department
of Policies for Women (SPM) in recognition of its commitment to promoting equality between
men and women in the workplace. Besides the holding company, Cepel, Ceal, CGTEE, Eletronor-
te, Eletronuclear, Eletrosul, Furnas and Itaipu Binacional were also considered for the seal.
Financial Statements for 2008
Furnas - Usina Luiz Carlos
Barreto
(Foto:VictorAndrade)
Annual Report 2008
95
Index
Annual Report 2008
BALANCE SHEETS FOR THE YEARS ENDED .............................................................98
BALANCE SHEETS FOR THE YEARS ENDED ........................................................... 100
STATEMENT OF INCOME FOR THE YEARS ENDED .................................................... 102
STATEMENT OF CASH FLOWS FOR THE YEARS ENDED ............................................. 104
STATEMENT OF CASH FLOWS FOR THE YEARS ENDED ............................................. 106
STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY ............................................. 108
ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTSSTATEMENT OF ADDED ...... 110
NOTE 1 – OPERATIONS ..................................................................................... 112
NOTE 2 – PUBLIC SERVICE CONCESSIONS ............................................................. 114
NOTE 3 – PRESENTATION OF THE FINANCIAL STATEMENTS ....................................... 116
NOTE 4 - SUMMARY OF MAIN ACCOUNTING PRACTICES ........................................... 121
NOTE 5 - CONSOLIDATION PROCEDURES .............................................................. 130
NOTE 6 - CASH AND CASH EQUIVALENTS ............................................................. 134
NOTE 7 - MARKETABLE SECURITIES .................................................................... 135
NOTE 8 - CONSUMERS AND RESELLERS OF ELECTRICITY .......................................... 137
NOTE 9 - LOANS AND FINANCING GRANTED ......................................................... 139
NOTE 10 - RESCHEDULED RECEIVABLES ............................................................... 141
NOTE 11 - RETURN ON INVESTMENTS .................................................................. 144
NOTE 12 - TAX CREDITS AND DEFERRED TAX ASSETS ........................................... 144
NOTE 13 - REGULATORY ASSETS ......................................................................... 147
NOTE 14 - NUCLEAR FUEL INVENTORIES .............................................................. 149
NOTE 15 - ADVANCES FOR AN INCREASE IN PARENT COMPANY’S OWNERSHIP INTEREST 150
NOTE 16 - INVESTMENTS .................................................................................. 151
NOTE 17 – PROPERTY, PLANT AND EQUIPMENT ..................................................... 159
NOTE 18 - INTANGIBLE ASSETS .......................................................................... 160
NOTE 19 - TRADE ACCOUNTS PAYABLE ................................................................. 161
NOTE 20 - ADVANCES FROM CONSUMERS ............................................................. 161
NOTE 21 - LOANS AND FINANCING OBTAINED ....................................................... 163
NOTE 22 - COMPULSORY LOAN ........................................................................... 165
NOTE 23 - GLOBAL REVERSION RESERVE QUOTA - RGR............................................ 167
NOTE 24 - TAXES AND SOCIAL CONTRIBUTIONS .................................................... 168
NOTE 25 - REGULATORY FEES ........................................................................... 170
NOTE 26 - SHAREHOLDERS’ COMPENSATION ......................................................... 171
NOTE 27 - PAYABLES TO THE BRAZILIAN FEDERAL TREASURY .................................. 173
96
Annual Report 2008
NOTE 28 - COMPLEMENTARY PENSION FUNDS ....................................................... 173
NOTE 29 - PROVISION FOR SHAREHOLDERS’ DEFICIT IN CONTROLLED COMPANIES ....... 179
NOTE 30 – PROVISION FOR CONTINGENCIES ......................................................... 180
NOTE 31 - OBLIGATIONS ASSUMED FOR THE DECOMMISSIONING OF ASSETS ............... 192
NOTE 32 - SHAREHOLDERS’ EQUITY .................................................................... 194
NOTE 33 - OPERATIONS WITH ELECTRICITY .......................................................... 197
NOTE 34 - DEDUCTIONS TO THE OPERATIONS WITH ELECTRICITY .............................. 198
NOTE 35 - OPERATING REVENUES - OWNERSHIP INTEREST ...................................... 198
NOTE 36 - PERSONNEL, MATERIAL, AND SERVICES ................................................. 199
NOTE 37 - ENERGY PURCHASED FOR RESALE AND USE OF THE ELECTRIC GRID ............ 199
NOTE 38 - OPERATING PROVISIONS .................................................................... 200
NOTE 39 – FINANCIAL INCOME (EXPENSES) ........................................................ 200
NOTE 40 - PROFIT SHARING ............................................................................. 201
NOTE 41 - COMPENSATION OF EMPLOYEES AND MANAGEMENT ............................... 201
NOTE 42 - DISCRETIONARY RESIGNATION PROGRAM .............................................. 201
NOTE 43 - FINANCIAL INSTRUMENTS AND RISK MANAGEMENT ................................. 202
NOTE 44 - TRANSACTIONS WITH RELATED PARTIES ................................................ 209
NOTE 45 - INSURANCE ..................................................................................... 216
NOTE 46 - STUDIES AND PROJECTS ..................................................................... 216
NOTE 47 - CORPORATE GOVERNANCE ................................................................... 216
NOTE 48 - RELATIONSHIP WITH INDEPENDENT AUDITORS ....................................... 217
NOTE 49 - INFORMATION ON RELEVANT FACT ........................................................ 218
Attachment I - CONSUMERS AND RESELLERS AS OF DECEMBER 31, 2008 AND 2007 ........... 220
Attachment II - LOANS AND FINANCING GRANTED AS OF DECEMBER 31, 2008 AND 2007 ... 222
Attachment III - INVESTMENTS IN CONSOLIDATED COMPANIES AS OF DECEMBER 31, 2008 .224
Attachment IV - PROPERTY, PLANT AND EQUIPMENT ..................................................... 226
Attachment IV - A - PROPERTY, PLANT AND EQUIPMENT ................................................ 228
Attachment V - LOANS AND FINANCING OBTAINED AS OF DECEMBER 31, 2008 AND 2007 ..230
Attachment VI - SUMMARIZED FINANCIAL STATEMENTS OF CONTROLLED
COMPANIES AS OF DECEMBER 31 ......................................................... 232
Attachment VII - Initials used in the Financial Statements ........................................... 234
Board of Executive Directors ............................................................................ 236
Independent Auditors Report ........................................................................... 238
Summary Information ..................................................................................... 244
97
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
BALANCE SHEETS FOR THE YEARS ENDED
DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
ASSETS
CURRENT
Cash and cash equivalents
Consumers and resellers
Loans and financing
Fuel Consumption Account - CCC
Return on investments
Rescheduled receivables
Deferred tax credits
Rights to reimbursement
Sundry receivables
Storeroom
Prepaid expenses
Other
NONCURRENT
LONG-TERM ASSETS
Loans and financing
Rescheduled receivables
Marketable securities
Nuclear fuel inventories
Studies and projects
Consumers and resellers
Deferred tax credits
Pledges and restricted deposits
Fuel Consumption Account - CCC
Rights to reimbursement
Other
interest
Advances for increase in parent company’s ownership
C O M PA N Y
C O N S O L I D A T E D
2008
2007
Reclassified
2008
2007
Reclassified
1.773.215
2.081.850
2.480.999
18.577.909
13.586.790
25.597.657
19.420.802
10.104.427
1.709.569
2.697.114
573.993
1.212.966
84.371
1.418.353
516.766
171.165
1.879
-
87.306
5.797.710
1.349.259
3.034.328
337.276
635.357
112.803
179.460
290.840
2.519
-
74.023
39.537.157
199.646
613.374
33.488.103
203.959
1.289.672
-
-
-
-
292.579
-
-
-
1.348.168
1.351.862
572.279
4.312.809
73.547
500.512
590.025
66.426
46.656.980
37.783.138
13.566.386
4.341.459
1.493.271
554.748
261.093
619.871
516.766
377.879
759.963
76.874
947.497
13.467.643
2.070.302
617.889
725.142
-
42.024
2.786.948
165.138
572.279
4.312.809
1.156.724
25.916.898
8.387.789
4.182.324
1.299.066
365.366
152.468
526.275
179.460
432.539
641.840
90.767
681.909
11.941.405
1.920.766
1.293.014
657.188
312.122
179.454
2.526.213
290.256
500.512
590.025
1.314.571
21.525.526
730.281
2.026.483
4.027
4.027
47.387.261
39.809.621
25.920.924
21.529.553
INVESTMENTS
43.682.718
43.062.138
5.896.865
5.193.138
PROPERTY, PLANT AND EQUIPMENT
25.494
28.807
80.262.674
75.262.669
INTANGIBLE ASSETS
DEFERRED CHARGES
TOTAL ASSETS
53.706
55.558
375.811
474.485
-
43.761.918
109.727.088
5.891
43.152.394
96.548.805
-
86.535.350
138.053.932
47.261
80.977.553
121.927.908
The accompanying notes and attachments I, II, III, IV, IV-A, V and VI are an integral part of these financial statements.
Annual Report 2008
C O M PA N Y
C O N S O L I D A T E D
2008
2007
Reclassified
2008
2007
Reclassified
10.104.427
1.709.569
2.697.114
573.993
1.212.966
84.371
1.418.353
516.766
171.165
1.879
-
87.306
18.577.909
39.537.157
199.646
613.374
-
-
-
1.348.168
-
572.279
4.312.809
73.547
46.656.980
5.797.710
1.349.259
3.034.328
337.276
635.357
112.803
1.773.215
179.460
290.840
2.519
-
74.023
13.586.790
33.488.103
203.959
1.289.672
-
292.579
-
1.351.862
-
500.512
590.025
66.426
37.783.138
13.566.386
4.341.459
1.493.271
554.748
261.093
619.871
2.081.850
516.766
377.879
759.963
76.874
947.497
25.597.657
13.467.643
2.070.302
617.889
725.142
-
42.024
2.786.948
165.138
572.279
4.312.809
1.156.724
25.916.898
8.387.789
4.182.324
1.299.066
365.366
152.468
526.275
2.480.999
179.460
432.539
641.840
90.767
681.909
19.420.802
11.941.405
1.920.766
1.293.014
657.188
312.122
179.454
2.526.213
290.256
500.512
590.025
1.314.571
21.525.526
ASSETS
CURRENT
Cash and cash equivalents
Consumers and resellers
Loans and financing
Fuel Consumption Account - CCC
Return on investments
Rescheduled receivables
Deferred tax credits
Rights to reimbursement
Sundry receivables
Storeroom
Prepaid expenses
Other
NONCURRENT
LONG-TERM ASSETS
Loans and financing
Rescheduled receivables
Marketable securities
Nuclear fuel inventories
Studies and projects
Consumers and resellers
Deferred tax credits
Pledges and restricted deposits
Fuel Consumption Account - CCC
Rights to reimbursement
Other
Advances for increase in parent company’s ownership
interest
730.281
2.026.483
4.027
4.027
47.387.261
39.809.621
25.920.924
21.529.553
INVESTMENTS
43.682.718
43.062.138
5.896.865
5.193.138
PROPERTY, PLANT AND EQUIPMENT
25.494
28.807
80.262.674
75.262.669
INTANGIBLE ASSETS
DEFERRED CHARGES
TOTAL ASSETS
53.706
55.558
375.811
474.485
-
43.761.918
109.727.088
5.891
43.152.394
96.548.805
-
86.535.350
138.053.932
47.261
80.977.553
121.927.908
The accompanying notes and attachments I, II, III, IV, IV-A, V and VI are an integral part of these financial statements.
99
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
BALANCE SHEETS FOR THE YEARS ENDED
DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT
Loans and financing
Compulsory loan
Trade accounts payable
Advances from consumers
Taxes and social contributions
Fuel Consumption Account - CCC
Shareholders’ compensation
Payables to the Brazilian Federal Treasury
Estimated obligations
Reimbursement obligations
Complementary pension plans
Provisions for contingencies
Research and development
Fees as per regulations
Other
NONCURRENT
Loans and financing
Payables to the Brazilian Federal Treasury:
Trade accounts payable
Global Reversion Reserve Quota - RGR
Compulsory loan
Taxes and social contributions
Obligations assumed for the release of assets
Advances from consumers
Fuel Consumption Account - CCC
Provisions for contingencies
Complementary pension plans
Provision for shareholders' deficit in investees
Other
SHAREHOLDERS’ EQUITY
Capital stock
Capital reserves
Revaluation surplus
Revenue reserves
Translation accumulated adjustments
Advances for future capital increase
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
C O M PA N Y
C O N S O L I D A T E D
2008
2007
Reclassified
2008
2007
Reclassified
78.910
7.038.580
33.648
4.811.031
14.287.016
11.924.636
192.181
85.205
1.676.071
15.381
1.363.854
649.341
1.914.222
72.236
67.835
923.344
139.430
96.709
1.269.365
202.250
1.092.560
515.418
881.002
58.150
78.274
444.225
-
-
-
-
-
-
-
-
-
3.965.930
2.854.201
1.576.872
726.989
7.193.770
129.866
943.882
6.769.011
202.375
572.279
1.009.514
500.512
1.037.192
353.921
46.784
875.777
85.810
-
-
-
-
-
-
-
-
-
1.481.709
1.095.852
1.714.611
85.205
2.594.567
53.159
2.075.726
670.482
1.948.109
72.236
550.573
923.344
502.699
269.062
708.285
637.249
18.297.562
2.854.201
24.282
7.193.770
129.866
2.713.664
266.168
1.018.488
1.432.982
1.695.556
1.567.002
-
1.450.815
96.709
2.476.444
237.441
1.955.794
518.522
902.915
58.150
468.148
444.225
368.950
367.101
541.968
941.602
13.029.068
726.989
16.668
6.769.011
202.375
1.690.671
451.017
1.056.761
1.431.641
1.881.291
1.841.685
-
28.900.908
25.800.369
28.900.908
25.800.369
26.156.567
26.048.342
196.906
28.285
81.331.008
4.287.353
85.618.361
109.727.088
24.235.829
25.907.304
208.109
-
76.151.611
3.811.625
79.963.236
96.548.805
26.156.567
26.048.342
196.906
28.285
81.331.008
4.287.353
85.618.361
24.235.829
25.907.304
208.109
-
76.151.611
3.811.625
79.963.236
138.053.932
121.927.908
INTEREST OF NON-CONTROLLING SHAREHOLDERS
-
232.668
313.008
17.070.147
11.774.538
37.915.887
29.727.028
722.346
629.851
The accompanying notes and attachments I, II, III, IV, IV-A, V and VI are an integral part of these financial statements.
Annual Report 2008
C O M PA N Y
C O N S O L I D A T E D
2008
2007
Reclassified
2008
2007
Reclassified
192.181
85.205
1.676.071
15.381
1.363.854
649.341
1.914.222
72.236
67.835
923.344
-
-
-
-
78.910
7.038.580
3.965.930
2.854.201
-
7.193.770
129.866
943.882
-
-
572.279
1.009.514
-
353.921
46.784
17.070.147
139.430
96.709
1.269.365
202.250
1.092.560
515.418
881.002
58.150
78.274
444.225
-
-
-
-
33.648
4.811.031
1.576.872
726.989
-
6.769.011
202.375
-
-
-
500.512
1.037.192
-
875.777
85.810
11.774.538
1.714.611
85.205
2.594.567
53.159
2.075.726
670.482
1.948.109
72.236
550.573
923.344
502.699
1.481.709
269.062
708.285
637.249
14.287.016
18.297.562
2.854.201
24.282
7.193.770
129.866
2.713.664
266.168
1.018.488
1.432.982
1.695.556
1.567.002
-
722.346
37.915.887
1.450.815
96.709
2.476.444
237.441
1.955.794
518.522
902.915
58.150
468.148
444.225
368.950
1.095.852
367.101
541.968
941.602
11.924.636
13.029.068
726.989
16.668
6.769.011
202.375
1.690.671
451.017
1.056.761
1.431.641
1.881.291
1.841.685
-
629.851
29.727.028
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT
Loans and financing
Compulsory loan
Trade accounts payable
Advances from consumers
Taxes and social contributions
Fuel Consumption Account - CCC
Shareholders’ compensation
Payables to the Brazilian Federal Treasury
Estimated obligations
Reimbursement obligations
Complementary pension plans
Provisions for contingencies
Research and development
Fees as per regulations
Other
NONCURRENT
Loans and financing
Payables to the Brazilian Federal Treasury:
Trade accounts payable
Global Reversion Reserve Quota - RGR
Compulsory loan
Taxes and social contributions
Obligations assumed for the release of assets
Advances from consumers
Fuel Consumption Account - CCC
Provisions for contingencies
Complementary pension plans
Provision for shareholders' deficit in investees
Other
INTEREST OF NON-CONTROLLING SHAREHOLDERS
-
-
232.668
313.008
SHAREHOLDERS’ EQUITY
Capital stock
Capital reserves
Revaluation surplus
Revenue reserves
Translation accumulated adjustments
Advances for future capital increase
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
26.156.567
26.048.342
196.906
28.900.908
28.285
81.331.008
4.287.353
85.618.361
109.727.088
24.235.829
25.907.304
208.109
25.800.369
-
76.151.611
3.811.625
79.963.236
96.548.805
26.156.567
26.048.342
196.906
28.900.908
28.285
81.331.008
4.287.353
85.618.361
138.053.932
24.235.829
25.907.304
208.109
25.800.369
-
76.151.611
3.811.625
79.963.236
121.927.908
The accompanying notes and attachments I, II, III, IV, IV-A, V and VI are an integral part of these financial statements.
101
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
STATEMENT OF INCOME FOR THE YEARS ENDED
DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
OPERATING REVENUES
Electricity sale, and transmission
(-) Sectorial charges
(-) State VAT (ICMS)
Ownership interests
Tax incentive revenue
Other revenues
OPERATING EXPENSES
Personnel, material, and services
Energy purchased for resale
Fuel for electricity production
PASEP and COFINS (taxes on sales)
Electricity network use
Financial compensation of water resources
Depreciation and amortization
Operating provisions
ITAIPU’s income (loss) to be offset
Donations and contributions
Other
OPERATING INCOME (LOSS) BEFORE FINANCIAL INCOME (EXPENSES)
FINANCIAL INCOME (EXPENSES)
OTHER EXPENSES AND INCOME
OPERATING INCOME
NON-OPERATING INCOME (LOSS)
INCOME (LOSS) BEFORE INCOME AND SOCIAL CONTRIBUTION TAXES, EMPLOYEES’ AND MAN-
AGEMENT PROFIT SHARING AND MINORITY INTEREST
Income tax
Social contribution tax on net income
INCOME (LOSS) BEFORE OWNERSHIP INTERESTS
Profit sharing
Minority interest
NET INCOME FOR THE YEAR / PERIOD
EARNINGS PER SHARE, NET
COMPANY
2008
10.927.053
-
-
382.799
-
-
278.453
9.572.208
-
160.551
-
-
6.864
303.994
-
153.650
150.159
683.973
7.797.423
-
2007
Reclassified
7.553.751
-
-
1.883.289
-
-
318.370
7.151.995
-
86.947
-
-
7.016
586.483
-
126.400
356.712
803.117
597.903
-
8.481.396
1.401.020
-
-
8.481.396
1.401.020
(1.700.759)
(621.140)
146.976
17.861
6.159.497
1.565.857
(23.000)
-
(18.000)
-
CONSOLIDATED
Quarters
4T/08
até 3T/08
139.669
370.517
9.573.586
(307.947)
(265.409)
48.119
343.251
308.947
1.547.196
3.319.965
244.107
371.610
293.442
301.968
590.371
1.260.170
342.664
85.573
(137.322)
21.877.178
(883.726)
(719.199)
617.414
-
3.892.446
5.512.349
914.749
1.093.199
807.778
798.809
1.749.533
283.921
493.221
132.340
632.642
4T/07
Reclassified
7.257.804
(346.697)
(256.814)
303.717
-
1.453.565
1.871.289
197.732
368.549
237.860
655.476
507.933
92.670
319.968
55.213
793.951
774.321
2008
2007
Reclassified
31.450.764
(1.191.673)
(984.608)
665.533
343.251
448.616
25.603.572
(1.235.991)
(882.750)
753.292
-
496.746
5.439.642
8.832.314
1.158.856
1.464.809
1.101.220
1.100.777
2.339.904
1.544.091
835.885
217.913
495.320
4.918.538
6.420.631
632.826
1.124.658
976.647
1.095.234
2.127.479
1.105.122
694.088
198.990
1.906.767
1.480.803
4.720.349
6.201.152
3.533.889
2.799.238
584.530
1.517.766
3.383.768
(1.208.663)
262.258
(294.516)
-
(32.258)
-
4.542.299
5.010.363
2.292.087
9.552.662
2.325.226
-
-
(22.237)
-
(41.309)
4.542.299
5.010.363
2.269.850
9.552.662
2.283.917
(930.938)
(343.017)
(1.431.921)
(520.639)
(354.029)
(116.618)
(2.362.859)
(863.656)
(415.322)
(172.612)
3.268.344
3.057.803
1.799.203
6.326.147
1.695.983
(176.817)
(53.117)
-
(159.983)
40.284
(48)
(176.817)
(12.833)
(159.926)
11.800
6.136.497
1.547.857
3.038.410
3.098.087
1.639.172
6.136.497
1.547.857
R$5,42
R$1,37
R$2,68
R$2,74
R$1,45
R$5,42
R$1,37
‘The accompanying notes and attachments I, II, III, IV, IV-A, V, and VI are an integral part of these financial statements.
Electricity sale, and transmission
10.927.053
7.553.751
OPERATING REVENUES
(-) Sectorial charges
(-) State VAT (ICMS)
Ownership interests
Tax incentive revenue
Other revenues
OPERATING EXPENSES
Personnel, material, and services
Energy purchased for resale
Fuel for electricity production
PASEP and COFINS (taxes on sales)
Electricity network use
Financial compensation of water resources
Depreciation and amortization
Operating provisions
ITAIPU’s income (loss) to be offset
Donations and contributions
Other
FINANCIAL INCOME (EXPENSES)
OTHER EXPENSES AND INCOME
OPERATING INCOME
NON-OPERATING INCOME (LOSS)
Income tax
Social contribution tax on net income
INCOME (LOSS) BEFORE OWNERSHIP INTERESTS
Profit sharing
Minority interest
NET INCOME FOR THE YEAR / PERIOD
EARNINGS PER SHARE, NET
OPERATING INCOME (LOSS) BEFORE FINANCIAL INCOME (EXPENSES)
INCOME (LOSS) BEFORE INCOME AND SOCIAL CONTRIBUTION TAXES, EMPLOYEES’ AND MAN-
AGEMENT PROFIT SHARING AND MINORITY INTEREST
COMPANY
2008
2007
Reclassified
382.799
1.883.289
278.453
9.572.208
318.370
7.151.995
160.551
86.947
-
-
-
-
-
-
-
-
-
-
6.864
303.994
153.650
150.159
683.973
7.797.423
-
-
-
-
-
-
-
-
-
-
7.016
586.483
126.400
356.712
803.117
597.903
8.481.396
1.401.020
(1.700.759)
(621.140)
146.976
17.861
6.159.497
1.565.857
(23.000)
-
(18.000)
-
Annual Report 2008
CONSOLIDATED
Quarters
4T/08
até 3T/08
9.573.586
(307.947)
(265.409)
48.119
343.251
308.947
1.547.196
3.319.965
244.107
371.610
293.442
301.968
590.371
1.260.170
342.664
85.573
(137.322)
21.877.178
(883.726)
(719.199)
617.414
-
139.669
3.892.446
5.512.349
914.749
1.093.199
807.778
798.809
1.749.533
283.921
493.221
132.340
632.642
4T/07
Reclassified
7.257.804
(346.697)
(256.814)
303.717
-
370.517
1.453.565
1.871.289
197.732
368.549
237.860
655.476
507.933
92.670
319.968
55.213
793.951
2008
2007
Reclassified
31.450.764
(1.191.673)
(984.608)
665.533
343.251
448.616
25.603.572
(1.235.991)
(882.750)
753.292
-
496.746
5.439.642
8.832.314
1.158.856
1.464.809
1.101.220
1.100.777
2.339.904
1.544.091
835.885
217.913
495.320
4.918.538
6.420.631
632.826
1.124.658
976.647
1.095.234
2.127.479
1.105.122
694.088
198.990
1.906.767
1.480.803
4.720.349
774.321
6.201.152
3.533.889
2.799.238
584.530
1.517.766
3.383.768
(1.208.663)
262.258
(294.516)
-
(32.258)
-
8.481.396
1.401.020
4.542.299
5.010.363
2.292.087
9.552.662
2.325.226
-
-
(22.237)
-
(41.309)
4.542.299
5.010.363
2.269.850
9.552.662
2.283.917
(930.938)
(343.017)
(1.431.921)
(520.639)
(354.029)
(116.618)
(2.362.859)
(863.656)
(415.322)
(172.612)
3.268.344
3.057.803
1.799.203
6.326.147
1.695.983
(176.817)
(53.117)
-
40.284
(159.983)
(48)
(176.817)
(12.833)
(159.926)
11.800
6.136.497
1.547.857
3.038.410
3.098.087
1.639.172
6.136.497
1.547.857
R$5,42
R$1,37
R$2,68
R$2,74
R$1,45
R$5,42
R$1,37
‘The accompanying notes and attachments I, II, III, IV, IV-A, V, and VI are an integral part of these financial statements.
103
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
STATEMENT OF CASH FLOWS FOR THE YEARS ENDED
DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
Adjustments to reconcile net income to cash provided by operating activities
OPERATING ACTIVITIES
Net income for the period
Depreciation and amortization
Long-term monetary variation, net
Adjustment to investments:
Regulatory assets
Long-term provisions
Adjustment to present value.
Minority interest
Financial charges on shareholders’ equity
ITAIPU’s income (loss) available for offset
Decrease in recoverable value of assets
Assets disposals and write-offs
Other
Subtotal
(Increase) decrease in operating assets
Consumers and resellers
Loans and financing - principal amount
Loans and financing - charges
Fuel Consumption Account - CCC
Return on investments
Marketable securities
Rescheduled receivables
Tax credits
Rights to reimbursement
Sundry receivables
Storeroom
Prepaid expenses
Other
Increase (decrease) in operating assets
Reimbursement obligations
Loans and financing - principal amount
Loans and financing - charges
Compulsory loan
Trade accounts payable
Advances from consumers
Taxes and social contributions
Fuel Consumption Account - CCC
Stockholders' compensation (dividends payable)
Payables to the Brazilian Federal Treasury:
Estimated obligations
Supplementary pension plans
Provisions for contingencies
Regulatory fees
Research and development
Other
Funds provided by (used in) operating activities
COMPANY
12/31/2008
12/31/2007
Reclassified
CONSOLIDATED
12/31/2008
12/31/2007
Reclassified
6.136.497
1.547.857
6.136.497
1.547.857
6.864
(4.811.429)
(199.702)
(1.409.637)
535.906
(7.159)
7.016
2.536.733
(1.455.947)
(287.746)
(938.109)
1.511.749
1.283.075
-
-
-
-
-
-
-
-
-
302.330
2.065.419
416.886
3.109.765
(360.310)
251.415
85.799
(236.717)
(577.609)
-
28.432
354.862
(337.306)
119.675
640
-
(13.286)
(684.405)
479.119
39.176
13.575
(11.504)
406.706
(186.869)
271.294
133.923
1.033.220
14.086
(10.439)
-
-
-
-
(168.865)
183.695
2.767.053
280.454
(91.626)
-
(5.868)
(559.794)
96.008
(288.562)
(92)
-
(8.391)
2.204.012
250.415
(26.902)
(3.636)
(14.397)
109.444
99.863
174.077
(321.460)
314.505
7.027
70.992
-
-
-
-
2.339.904
(2.945.187)
(162.578)
(1.410.394)
775.543
(113.672)
176.817
1.522.506
107.868
770.293
58.160
704.836
7.960.593
(159.135)
(170.960)
(23.244)
(189.382)
(108.624)
-
(93.596)
399.149
(337.306)
54.660
(118.123)
15.697
(267.394)
(998.258)
479.119
233.671
30.124
(11.504)
118.123
(184.282)
119.932
151.960
1.045.195
14.086
82.426
133.749
385.857
(147.670)
166.317
(254.723)
2.362.380
9.324.715
2.128.575
3.153.574
(306.002)
(287.746)
(942.233)
(11.847)
1.289.037
(694.088)
-
-
46.328
112.285
6.035.740
292.647
251.204
(308.907)
269.600
21.987
-
(174.117)
(609.681)
(97.802)
(299.307)
(78.664)
(38.998)
(148.573)
(920.611)
(388.936)
(598.198)
55.580
(14.397)
171.208
102.532
431.050
(358.504)
311.704
7.027
173.483
23.027
97.841
317.470
444.225
411.259
45.263
2.227.550
3.608.564
(239.106)
420.822
5.734.599
1.186.371
6.301.500
tobe continued...
Annual Report 2008
OPERATING ACTIVITIES
Net income for the period
COMPANY
12/31/2008
CONSOLIDATED
12/31/2007
Reclassified
12/31/2008
12/31/2007
Reclassified
6.136.497
1.547.857
6.136.497
1.547.857
Adjustments to reconcile net income to cash provided by operating activities
Depreciation and amortization
Long-term monetary variation, net
Adjustment to investments:
Regulatory assets
Long-term provisions
Adjustment to present value.
Minority interest
Financial charges on shareholders’ equity
ITAIPU’s income (loss) available for offset
Decrease in recoverable value of assets
Assets disposals and write-offs
Other
Subtotal
6.864
(4.811.429)
(199.702)
(1.409.637)
535.906
(7.159)
-
1.511.749
-
-
-
302.330
2.065.419
7.016
2.536.733
(1.455.947)
(287.746)
(938.109)
-
-
1.283.075
-
-
-
416.886
3.109.765
(Increase) decrease in operating assets
Consumers and resellers
Loans and financing - principal amount
Loans and financing - charges
Fuel Consumption Account - CCC
Return on investments
Marketable securities
Rescheduled receivables
Tax credits
Rights to reimbursement
Sundry receivables
Storeroom
Prepaid expenses
Other
Increase (decrease) in operating assets
Reimbursement obligations
Loans and financing - principal amount
Loans and financing - charges
Compulsory loan
Trade accounts payable
Advances from consumers
Taxes and social contributions
Fuel Consumption Account - CCC
Stockholders' compensation (dividends payable)
Payables to the Brazilian Federal Treasury:
Estimated obligations
Supplementary pension plans
Provisions for contingencies
Regulatory fees
Research and development
Other
Funds provided by (used in) operating activities
(360.310)
251.415
85.799
(236.717)
(577.609)
-
28.432
354.862
(337.306)
119.675
640
-
(13.286)
(684.405)
479.119
39.176
13.575
(11.504)
406.706
(186.869)
271.294
133.923
1.033.220
14.086
(10.439)
-
-
-
-
45.263
2.227.550
3.608.564
(168.865)
183.695
2.767.053
280.454
(91.626)
-
(5.868)
(559.794)
96.008
(288.562)
(92)
-
(8.391)
2.204.012
250.415
(26.902)
(3.636)
(14.397)
109.444
99.863
174.077
(321.460)
314.505
7.027
70.992
-
-
-
-
(239.106)
420.822
5.734.599
2.339.904
(2.945.187)
(162.578)
(1.410.394)
775.543
(113.672)
176.817
1.522.506
107.868
770.293
58.160
704.836
7.960.593
(159.135)
(170.960)
(23.244)
(189.382)
(108.624)
-
(93.596)
399.149
(337.306)
54.660
(118.123)
15.697
(267.394)
(998.258)
479.119
233.671
30.124
(11.504)
118.123
(184.282)
119.932
151.960
1.045.195
14.086
82.426
133.749
385.857
(147.670)
166.317
(254.723)
2.362.380
9.324.715
2.128.575
3.153.574
(306.002)
(287.746)
(942.233)
-
(11.847)
1.289.037
(694.088)
-
46.328
112.285
6.035.740
292.647
251.204
(308.907)
269.600
21.987
-
(174.117)
(609.681)
(97.802)
(299.307)
(78.664)
(38.998)
(148.573)
(920.611)
(388.936)
(598.198)
55.580
(14.397)
171.208
102.532
431.050
(358.504)
311.704
7.027
173.483
23.027
97.841
317.470
444.225
411.259
1.186.371
6.301.500
tobe continued...
105
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
STATEMENT OF CASH FLOWS FOR THE YEARS ENDED
DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
FINANCING ACTIVITIES
Long-term loans and financing obtained
Long-term financing reclassified as current
Stockholders’ compensation
Loans and financing granted - disbursements
Loans and financing granted - receipts
Noncurrent amounts reclassified as current
Refinancing obtained (current liabilities reclassified as noncurrent)
Refinancing granted (current assets reclassified as noncurrent)
Compulsory loan and RGR
Other
Funds provided by (used in) financing activities
INVESTMENT ACTIVITIES
Acquisition of property, plant and equipment
Investments
Dividends received
Funds provided by (used in) investments
COMPANY
12/31/2008
1.403.383
(1.305.028)
(1.715.254)
(2.473.197)
4.888.858
244.690
-
12/31/2007
Reclassified
-
(772.109)
(703.486)
(3.413.978)
3.309.303
-
28.010
(2.493.905)
(1.850.465)
950.632
77.849
875.571
16.640
(421.972)
(2.510.514)
CONSOLIDATED
12/31/2008
...Continued
12/31/2007
Reclassified
2.002.621
(2.369.498)
(1.718.778)
(740.316)
1.682.382
1.118.000
102.985
(144.469)
950.632
(294.109)
589.450
1.503.372
(2.419.250)
(751.127)
(1.295.055)
4.549.316
(612.594)
64.438
(2.236.442)
875.571
(813.468)
(1.135.239)
(23.656)
(168.050)
1.311.831
1.120.125
(8.013)
(538.534)
-
(4.243.661)
(837.525)
345.618
(3.521.642)
900.294
-
(546.547)
(4.735.568)
(2.621.348)
Increase in cash and cash equivalents
4.306.717
2.677.538
5.178.597
2.544.913
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
5.797.710
10.104.427
4.306.717
3.120.172
5.797.710
2.677.538
8.387.789
13.566.386
5.178.597
5.842.876
8.387.789
2.544.913
‘The accompanying notes and attachments I, II, III, IV, IV-A, V and VI are an integral part of these financial statements.
Annual Report 2008
FINANCING ACTIVITIES
Long-term loans and financing obtained
Long-term financing reclassified as current
Stockholders’ compensation
Loans and financing granted - disbursements
Loans and financing granted - receipts
Noncurrent amounts reclassified as current
Refinancing obtained (current liabilities reclassified as noncurrent)
Refinancing granted (current assets reclassified as noncurrent)
Compulsory loan and RGR
Other
Funds provided by (used in) financing activities
INVESTMENT ACTIVITIES
Acquisition of property, plant and equipment
Investments
Dividends received
Funds provided by (used in) investments
COMPANY
12/31/2008
1.403.383
(1.305.028)
(1.715.254)
(2.473.197)
4.888.858
244.690
-
(2.493.905)
950.632
77.849
(421.972)
12/31/2007
Reclassified
-
(772.109)
(703.486)
(3.413.978)
3.309.303
-
28.010
(1.850.465)
875.571
16.640
(2.510.514)
...Continued
CONSOLIDATED
12/31/2008
12/31/2007
Reclassified
2.002.621
(2.369.498)
(1.718.778)
(740.316)
1.682.382
1.118.000
102.985
(144.469)
950.632
(294.109)
589.450
1.503.372
(2.419.250)
(751.127)
(1.295.055)
4.549.316
(612.594)
64.438
(2.236.442)
875.571
(813.468)
(1.135.239)
(23.656)
(168.050)
1.311.831
1.120.125
(8.013)
(538.534)
-
(546.547)
(4.243.661)
(837.525)
345.618
(4.735.568)
(3.521.642)
900.294
-
(2.621.348)
Increase in cash and cash equivalents
4.306.717
2.677.538
5.178.597
2.544.913
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
5.797.710
10.104.427
4.306.717
3.120.172
5.797.710
2.677.538
8.387.789
13.566.386
5.178.597
5.842.876
8.387.789
2.544.913
‘The accompanying notes and attachments I, II, III, IV, IV-A, V and VI are an integral part of these financial statements.
107
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
SUBSCRIBED AND
PAID CAPITAL
STOCK
CAPITAL
RESERVES
REVALUATION
SURPLUS
LEGAL
RESERVE
STATUTORY
DIVIDENDS NOT
RESERVE
DISTRIBUTED
RETAINED
EARNINGS
ACCUMULATED
TRANSLATION
ADJUSTMENTS
ACCUMULATED
EARNINGS
ADVANCES FOR
FUTURE CAPITAL
INCREASE
T O T A L
SHAREHOLDERS’
EQUITY
REVENUES RESERVES
As of December 31, 2006
24.235.829
25.907.304
230.538
1.653.645
14.910.344
7.421.522
68.748
Financial charges - Decree 2,673/98
Realization of revaluation surplus
Net income
Application of income:
Recognition of reserves
Shareholders’ compensation
(22.429)
879.310
77.393
789.407
As of December 31, 2007
24.235.829
25.907.304
208.109
1.731.038
15.699.751
8.300.832
68.748
3.811.625
79.963.236
Initial adjustments ref. Law no. 11,638/2007
Company
Companies appraised by the equity method
Incorporation of surplus reserves
Conversion of compulsory loan
Accumulated translation adjustments
Financial charges – Decree 2,673/98
Realization of revaluation surplus
Net income
Application of income:
Recognition of reserves
Shareholders’ compensation
1.859.401
61.337
141.038
(1.790.653)
(68.748)
(11.203)
1.036.026
475.728
28.285
306.824
3.129.614
487.476
As of December 31, 2008
26.156.567
26.048.342
196.906
2.037.862
17.038.712
9.336.858
487.476
28.285
-
4.287.353
85.618.361
3.407.858
77.835.788
403.767
1.283.077
1.547.857
-
-
(703.486)
(767.186)
258.654
202.375
28.285
1.511.754
6.136.497
-
-
-
(1.715.254)
22.429
1.547.857
(866.800)
(703.486)
(767.186)
258.654
11.203
6.136.497
(3.923.914)
(1.715.254)
The accompanying notes and attachments I, II, III, IV, IV-A, V, VI and VII are an integral part of these financial statements.
Annual Report 2008
SUBSCRIBED AND
PAID CAPITAL
STOCK
CAPITAL
RESERVES
REVALUATION
SURPLUS
LEGAL
RESERVE
STATUTORY
RESERVE
DIVIDENDS NOT
DISTRIBUTED
RETAINED
EARNINGS
ACCUMULATED
TRANSLATION
ADJUSTMENTS
ACCUMULATED
EARNINGS
ADVANCES FOR
FUTURE CAPITAL
INCREASE
T O T A L
SHAREHOLDERS’
EQUITY
REVENUES RESERVES
As of December 31, 2006
24.235.829
25.907.304
230.538
1.653.645
14.910.344
7.421.522
68.748
3.407.858
77.835.788
77.393
789.407
879.310
403.767
22.429
1.547.857
(866.800)
(703.486)
1.283.077
-
1.547.857
-
(703.486)
As of December 31, 2007
24.235.829
25.907.304
208.109
1.731.038
15.699.751
8.300.832
68.748
3.811.625
79.963.236
1.859.401
61.337
141.038
(1.790.653)
(68.748)
1.036.026
28.285
306.824
3.129.614
487.476
(767.186)
258.654
11.203
6.136.497
(3.923.914)
(1.715.254)
475.728
(767.186)
258.654
-
202.375
28.285
1.511.754
-
6.136.497
-
(1.715.254)
26.156.567
26.048.342
196.906
2.037.862
17.038.712
9.336.858
487.476
28.285
-
4.287.353
85.618.361
Financial charges - Decree 2,673/98
Realization of revaluation surplus
Net income
Application of income:
Recognition of reserves
Shareholders’ compensation
Initial adjustments ref. Law no. 11,638/2007
Company
Companies appraised by the equity method
Incorporation of surplus reserves
Conversion of compulsory loan
Accumulated translation adjustments
Financial charges – Decree 2,673/98
Realization of revaluation surplus
Net income
Application of income:
Recognition of reserves
Shareholders’ compensation
As of December 31, 2008
(22.429)
(11.203)
The accompanying notes and attachments I, II, III, IV, IV-A, V, VI and VII are an integral part of these financial statements.
109
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS
STATEMENT OF ADDED VALUE FOR THE YEARS ENDED
DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
2008
2007
COMPANY
CONSOLIDATED
COMPANY
CONSOLIDATED
10.766.502
29.760.956
-
10.766.502
29.760.956
7.553.751
-
7.553.751
26.100.318
(41.309)
26.059.009
(361.321)
(9.572.208)
(5.533.156)
(1.191.673)
(8.832.314)
(1.158.856)
(541.057)
(7.151.995)
-
-
(6.545.100)
(1.235.991)
(6.420.631)
(632.826)
(9.933.529)
(16.715.999)
(7.693.052)
(14.834.548)
832.973
13.044.957
(139.301)
11.224.461
-
-
-
(303.994)
(6.864)
(310.858)
(1.544.091)
(2.339.904)
(3.883.995)
(586.483)
(7.016)
(593.499)
(1.105.122)
(2.127.479)
(3.232.601)
1 - REVENUE (EXPENSES)
Sales of goods, products, and services
Non-operating revenue (expenses)
2 - INPUTS ACQUIRED FROM THIRD PARTIES
Materials, services, and others
Sectorial charges
Energy purchased for resale
Fuel for electricity production
3 - GROSS ADDED VALUE
4 - DEDUCTIONS
Operating provisions
Depreciation, amortization and depletion
DISTRIBUTION OF ADDED VALUE
PERSONNEL
. Personnel, charges, and management fees
. Profit sharing of employees
. Retirement and pension plans
TAXES
. Taxes and contributions
SHAREHOLDERS
. Dividends and interest on equity capital
. Interest of non-controlling shareholders
. Retained earnings
5 - NET ADDED VALUE PRODUCED BY THE COMPANY
522.115
9.160.962
(732.800)
7.991.860
6 - ADDED VALUE RECEIVED THROUGH TRANSFER
Ownership interests
Financial income
382.799
9.853.101
10.235.900
665.533
6.425.431
7.090.964
1.883.289
2.398.932
4.282.221
753.292
1.595.159
2.348.451
7 - TOTAL ADDED VALUE TO DISTRIBUTE
10.758.015
16.251.926
3.549.421
10.340.311
FINANCIAL CHARGES AND RENT
2.055.678
3.041.663
1.801.029
2.803.822
200.973
23.000
19.968
243.941
3.392.799
176.817
277.635
3.847.251
248.352
18.000
12.073
278.425
3.003.916
159.926
229.448
3.393.290
2.321.899
3.226.515
(77.890)
2.595.342
1.715.254
-
4.421.243
6.136.497
1.715.254
(12.833)
4.434.076
6.136.497
703.486
-
844.371
1.547.857
703.486
11.800
832.571
1.547.857
10.758.015
16.251.926
3.549.421
10.340.311
‘The accompanying notes and attachments I, II, III, IV, IV-A, V and VI are an integral part of these financial statements.
Annual Report 2008
1 - REVENUE (EXPENSES)
Sales of goods, products, and services
Non-operating revenue (expenses)
2 - INPUTS ACQUIRED FROM THIRD PARTIES
Materials, services, and others
Sectorial charges
Energy purchased for resale
Fuel for electricity production
2008
2007
COMPANY
CONSOLIDATED
COMPANY
CONSOLIDATED
10.766.502
-
10.766.502
29.760.956
-
29.760.956
7.553.751
-
7.553.751
26.100.318
(41.309)
26.059.009
(361.321)
-
(9.572.208)
-
(9.933.529)
(5.533.156)
(1.191.673)
(8.832.314)
(1.158.856)
(16.715.999)
(541.057)
-
(7.151.995)
-
(7.693.052)
(6.545.100)
(1.235.991)
(6.420.631)
(632.826)
(14.834.548)
3 - GROSS ADDED VALUE
832.973
13.044.957
(139.301)
11.224.461
4 - DEDUCTIONS
Operating provisions
Depreciation, amortization and depletion
(303.994)
(6.864)
(310.858)
(1.544.091)
(2.339.904)
(3.883.995)
(586.483)
(7.016)
(593.499)
(1.105.122)
(2.127.479)
(3.232.601)
5 - NET ADDED VALUE PRODUCED BY THE COMPANY
522.115
9.160.962
(732.800)
7.991.860
6 - ADDED VALUE RECEIVED THROUGH TRANSFER
Ownership interests
Financial income
382.799
9.853.101
10.235.900
665.533
6.425.431
7.090.964
1.883.289
2.398.932
4.282.221
753.292
1.595.159
2.348.451
7 - TOTAL ADDED VALUE TO DISTRIBUTE
10.758.015
16.251.926
3.549.421
10.340.311
DISTRIBUTION OF ADDED VALUE
PERSONNEL
. Personnel, charges, and management fees
. Profit sharing of employees
. Retirement and pension plans
TAXES
. Taxes and contributions
200.973
23.000
19.968
243.941
3.392.799
176.817
277.635
3.847.251
248.352
18.000
12.073
278.425
3.003.916
159.926
229.448
3.393.290
2.321.899
3.226.515
(77.890)
2.595.342
FINANCIAL CHARGES AND RENT
2.055.678
3.041.663
1.801.029
2.803.822
SHAREHOLDERS
. Dividends and interest on equity capital
. Interest of non-controlling shareholders
. Retained earnings
1.715.254
-
4.421.243
6.136.497
1.715.254
(12.833)
4.434.076
6.136.497
703.486
-
844.371
1.547.857
703.486
11.800
832.571
1.547.857
10.758.015
16.251.926
3.549.421
10.340.311
‘The accompanying notes and attachments I, II, III, IV, IV-A, V and VI are an integral part of these financial statements.
111
CENTRAIS ELÉTRICAS BRASILEIRAS S.A. - ELETROBRÁS
(A PUBLIC COMPANY) CNPJ (TIN) 00.001.180/0001-26
Annual Report 2008
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007
(COMPANY AND CONSOLIDATED)
NOTE 1 – OPERATIONS
I - General Information
ELETROBRÁS is a public company headquartered in Brasília - DF, at Setor Comercial Norte,
Quadra 4, Bloco B, 100, sala 203 - Asa Norte, registered with the Brazilian Securities and
Exchange Commission (CVM) and with the Securities and Exchange Commission (SEC), whose
shares are listed at the stocks exchanges of São Paulo, Brazil (BOVESPA), Madrid, Spain (LA-
TIBEX), and New York, USA (NYSE). It has as business purpose to execute studies, projects,
construction, and operation of electricity generating plants, transmission lines and energy
distribution, as well as the execution of commercial transactions associated with those activi-
ties. It also has as purpose to grant financing, and offer guarantees in Brazil and overseas to
companies that work in the electric power public service and that are under its stock control;
grant financing and give guarantees in Brazil or abroad in favor of technical-scientific research
entities; promote and support research in the electric power sector associated with the acti-
vities of generation, transmission and distribution of electricity, as well as the performance
of studies about the use of hydrographical basins for multiple purposes; contribute in the
formation of the necessary technical personnel to the Brazilian electric sector, besides the
preparation of qualified workers through specific courses, in addition to assistance to Brazilian
schools or granting of scholarships overseas and agreements with entities that cooperate in
the formation of specialized technical personnel; cooperate at technical and administrative
levels with the companies where it holds interests and with agencies of the Ministry of Mining
and Energy.
II - Stockholding Control
ELETROBRÁS acts as holding company, managing investments in its controlled companies
by holding direct interests in seven electricity generation and/or transmission companies,
namely, FURNAS Centrais Elétricas S.A. (FURNAS), Centrais Elétricas do Norte do Brasil S.A.
(ELETRONORTE), MANAUS ENERGIA S.A., Companhia Hidro Elétrica do São Francisco (CHESF),
ELETROSUL Centrais Elétricas S.A., Eletrobrás Termonuclear S.A. (ELETRONUCLEAR), and Com-
panhia de Geração Térmica de Energia Elétrica (CGTEE) besides investments in four power
distribution companies - ELETROACRE, CERON, CEAL and CEPISA.
The Company also holds interests in Eletrobrás Participações S.A. (ELETROPAR) (previously
called LIGHTPAR Participações S.A.) and is a jointly-owner of ITAIPU Binacional, under the
terms of the International Treaty signed by the Governments of Brazil and Paraguay.
The Company has indirect interests in the company Boa Vista Energia S.A., a wholly-owned
subsidiary of ELETRONORTE, which generates and distributes electricity in States of Amazonas
and Roraima.
112
III - Business abroad
On April 7, 2008, Law 11.651 was enacted. It authorizes ELETROBRÁS to make direct as-
sociations with other companies - or indirectly through its subsidiaries - to organize business
consortia or hold participating interests in enterprises overseas - with or without contribution
of capital - with the purpose of direct or indirect production or transmission of electricity.
IV - Sale of electric power
The Company is also the agent responsible for the commercialization of the electric power
generated by ITAIPU Binacional and through PROINFA (Incentive Program for Alternative
Sources of Electricity), a Federal program that aims to diversify the Brazilian energetic matrix
and seek regional solutions by renewable energy sources.
V - Management of Sectorial Funds
The Company is responsible for the management of federal government funds, represented
by the Global Reversal Reserve Quota (RGR), the Electric Development Account (CDE), the Use
of Public Assets (UBP), and the Fuel Consumption Account (CCC). They finance the following
programs of the Brazilian federal government: universalization of the access to electricity,
efficient public lighting, incentives for alternative sources of electricity, electricity conser-
vation and acquisition of fossil fuels used in the isolated systems of electricity generation,
whose operations do not affect the Company’s financial numbers.
Annual Report 2008
113
Annual Report 2008
NOTE 2 – PUBLIC SERVICE CONCESSIONS
ELETROBRÁS, through its controlled companies, holds various electricity public service
concessions, whose details, installed capacity, and maturities are listed below (See note 17
and Attachments IV and IVa):
I - Electricity Generation
RIVER NAME
CAPACITY IN MW
MATURITY
IN OPERATION
UHE FURNAS
UHE Estreito
UHE Marimbondo
UHE Itumbiara
UHE Serra da Mesa
UHE Luiz Gonzaga
UHE Xingo
UHE Sobradinho
UHE Tucuruí
UHE Complexo Paulo Afonso
UTE Santa Cruz
Other generation concessions
IN CONSTRUCTION
UHE Simplício
UHE Baguari
UHE Batalha
Grande
Grande
Grande
Paranaíba
Tocantins
São Francisco
São Francisco
São Francisco
Tocantins
São Francisco
-
-
Paraíba do Sul
Doce
São Marcos
1,216
1,050
1,440
2,082
1,275
1,479
3,162
1,050
8,370
3,880
766
2,552
334
140
53
28,848
July 2015
July 2015
March 2017
February 2020
May 2011
October 2015
October 2015
February 2022
July 2024
October 2015
July 2015
Until 2035
August 2041
August 2041
August 2041
The total installed capacity of the plants of ELETROBRÁS, including ITAIPU Binacional
and ELETRONUCLEAR, is about 39,402 MW. The electricity generation considers the following
assumptions:
a) Existence of periods, along the day and during the year, where there are higher or
lower demands of power in the system, for which the plant or generation system was
dimensioned;
114
Annual Report 2008
b) Existence of periods where machines are removed from operation for execution of pre-
ventive or corrective maintenance, and
c) The water availability of the river where it is located.
The production of electricity of the plants is a responsibility of the Energy Operation
Planning and Scheduling Area (Planejamento e Programação da Operação Eletroener-
gética), with planning and details that range from annual levels to daily schedules.
The Electric Power National Operator (ONS) currently prepares the planning and defines
the amounts and origin of the necessary generation to meet the Brazilian demand in
an optimized manner. That is based on the water availability in the hydrographical
basins and machines in operation, as well as on the cost of generation and feasibility
of transmission of that power through the interlinked system.
II - Electric Power Transmission
The transmission capacity of ELETROBRÁS system is as follows:
Lines in Km
Substations
Maturity
Furnas
Eletronorte
Chesf
Eletrosul
Manaus
19,278
10,574
18,468
10,075
613
59,008
47
59
83
36
22
247
July 2015
July 2015
June 2037
July 2015
July 2015
III - Electricity Distribution
Company
Company
Eletroacre
Ceron
Ceal
Cepisa
Manaus Energia
State of Acre
State of Rondônia
State of Alagoas
State of Piauí
State of Manaus
Municipalities
served
Concession Term
25
52
102
224
62
2015
2015
2015
2015
2015
115
Annual Report 2008
NOTE 3 – PRESENTATION OF THE FINANCIAL STATEMENTS
The individual and consolidated financial statements of the Company are a responsibility
of its management and are presented in accordance with the accounting practices adopted
in Brazil, and in consonance with the provisions of the Corporate Law (no. 6.404/76), and
regulations and complementary instructions of the Committee of Accounting Pronouncements
(CPC), Federal Accounting Council, Brazilian Securities and Exchange Commission (CVM) and
Brazilian Electric Power Agency (ANEEL).
Law 11.638/2007 of December 28, 2007 and Executive Act 449/2008 of December 3, 2008,
whose period was extended for sixty day by National Congress Act No. 3 of March 4, 2009
starting on March 15, 2009, amended and canceled certain provisions of Law 6.404/76. They
aim to coordinate the accounting practices adopted in Brazil with International Financial Re-
porting Standards (IFRS) and the Committee of Accounting Pronouncements (CPC) was created
to align Brazilian technical accounting practices with international standards.
The Company fully adopted for the first time the applicable pronouncements issued by the
Committee of Accounting Pronouncements (CPC) in the preparation of the Financial State-
ments of the year 2008, without any qualifications. The initial adjustments of January 1, 2008,
the established transition date, were reflected in the account of retained earnings, as allowed
by CVM Decision 565/2008, without retrospective effects to the Financial Statements of 2007
prepared according to the previous accounting practices accepted in Brazil and in effect until
December 31, 2007.
Executive Act 449/2008 also established the Tax Transition Regime (RTT) providing the tax
treatment to the effects of the introduction of the new Brazilian accounting regulations.
The date for conclusion of the financial statements was set by the Board of Directors on
March 20, 2009 and sent to the Executive Board.
The changes introduced in the Brazilian accounting practices can be summarized as follows:
I - Changes affecting the preparation and presentation of the Company’s finan-
cial statements and the ones of its controlled companies:
a) Statement of Changes in Financial Position
The Statement of Changes in Financial Position will be not longer used. Instead, it
was introduced the Statement of Cash Flows. In compliance with item 51 of CPC Pro-
nouncement 13, the Company is not presenting a Statement of Changes in Financial
Position for the year ended December 31, 2007 and had already adopted the practice
of presenting a Statement of Cash Flows.
b) Statement of Added Value
Inclusion of the presentation of a Statement of Added Value. It has as purpose to
116
Annual Report 2008
demonstrate the value added by the Company, as well as the origin and destination
of the funds generated. The Company had already adopted the practice of presenting
such statement.
c) Intangible Assets
Creation in the balance sheet of a new group of accounts called Intangible Assets. It
should be used to record non-physical items destined for the maintenance and opera-
tion of the Company.
d) Deferred Assets
Elimination of the group of accounts called Deferred Assets. The Company opted to
transfer to other groups (Property, plant and equipment and Intangible assets) the ite-
ms recorded in the under the old caption or those arising from the write-off of deferred
expenses that could not be allocated in assets at the transition date, by recording the
value against accumulated earnings or loss, net of tax effects.
e) Accumulated Financial Statements Translation Adjustments
Creation in Shareholders’ Equity of a subgroup of accounts called Accumulated Trans-
lation Adjustments, destined to recognize the effects of exchange variation on in-
vestments and translation of Financial Statements presented in a functional currency
different from the one of the investor.
f) Revaluation Reserve
The new accounting rules no longer allow the revaluation of assets and recognition of the
result in a revaluation reserve. The Company has that type of record associated with in-
vestments in related companies valued under the equity method. In relation to that, the
Company has been following the procedures adopted by its controlled companies CELPA and
CEMAT that revalued their property, plant, and equipment in the past.
g) Non-Operating Income
The separation between operating and non-operating income was eliminated. The
amounts until then recorded in non-operating income accounts are now classified and
presented in Other Revenue or Other Expenses in the Operating group.
h) Financial Instruments
The classification of financial instruments into a certain category should be made at
the moment of their recognition. During the initial application of the Law, their clas-
sification at the transition date is allowed. The Company applied the classification and
measuring rule established in CPC Pronouncement 14 - Financial Instruments: Recogni-
tion, Measuring, and Supporting Documentation.
117
Annual Report 2008
i) Adjustment to Present Value
In compliance with Decision CVM no. 564 of December 17, 2008 that approved CPC
Pronouncement 12, the Company and its subsidiaries recognized the applicable adjust-
ments to present value of long-term assets and liabilities. Until December 31, 2007,
the corresponding balances were recorded and presented at face value. According to the
definitions included in CPC Pronouncement 13 - Initial Adoption of Law 11.638/2007,
as well as Executive Act 449/2008, approved by Decision CVM no. 565/2008, such ad-
justments were made at the transition date against accumulated earnings or losses.
j) Asset Recovery Value (Impairment)
Pursuant to the requirements of Decision CVM 527/2007 of November 1, 2007, that
approves CPC Pronouncement 1 - Reduction in the Recoverable Value of Assets, the
Company and its subsidiaries carried out the necessary tests to check the recoverability
of their assets taken as a whole, that is, as cash-generating units.
k) Equity Method
Following the changes in the parameters to define which investments should be ap-
praised under the equity method, the Company and its subsidiaries started applying
that type of valuation to permanent investments in companies where they hold 20%
or more interests in the voting capital or have significant influence on the investee’s
management.
l) Capital Reserve - Donations and Subsidies for Investment
In accordance with Law 11.638/2007, Executive Act 449/2008, and CPC Pronounce-
ment 7 – Subvention and Governmental Grants, the Company started recognizing the
corresponding amounts as operating income. As establishes CPC Pronouncement 13
- Initial Adoption of Law 11.638/2007 and Executive Act 449/2008, the balance of
capital reserves, donations and subsidies for investment will be kept in the account
until totally used.
m) Tax Effects of the Initial Application of Law 11.638/2007 and Executive Act
449/2008
The Company opted for the Transition Tax Regime (RTT) established by Executive Act
449/2008, whereby the determination of Corporate Income Tax (IRPJ), Social Contri-
bution Tax (CSLL), Contribution for the Social Integration Program (PIS/PASEP) and
Contribution for Social Security Funding (COFINS) for the two-year period 2008 - 2009
will continue being determined under the methods and accounting criteria defined by
Law 6.404, of December 15, 1976 in effect until December 31, 2007. Therefore, follo-
wing CVM instruction no. 371/2002, deferred income, and social contribution taxes,
calculated on the adjustments associated with the adoption of the new practices, were
recorded in the Company’s financial statements, where applicable.
118
II - Changes not affecting the preparation and presentation of the Company’s
financial statements and the ones of its subsidiaries:
a) Lease-Purchase Agreements
New requirement of recording in Property, Plant, and Equipment the Company’s rights
on physical goods destined to maintain its activities related to lease-purchase agree-
ments where there is transfer to the lessee of benefits, risks and control of the assets.
The management of the Company and its controlled companies did not identify any
operations classified under CPC Pronouncement 6 – Lease-Purchase Agreements.
b) Share-Based Compensation
The costs related to compensations based on shares granted to the executives of an
enterprise should be recognized in the entity’s financial statements. The Company and
its subsidiaries do not use any type of compensation classified under CPC Pronounce-
ment 10 - Share-based payments.
c) Deferred Income
Elimination in the Balance sheet of the group of accounts called Deferred Income.
d) Equity Valuation Adjustment
A new subgroup in Shareholders’ Equity was created, according to paragraph 3 of article
182 of the Brazilian Corporate Law (6.404/76), with text provided by Executive Act
449/08. It should be used to recognize increases and decreases in the value of assets
and liabilities caused by their valuation at fair value.
Annual Report 2008
119
Annual Report 2008
III - We present below the effects on net income and on shareholders’ equity of the
new accounting practices adopted this year:
COMPANY
2008
Net
Shareholders’
Líquido
Equity
6,408,768
86,121,846
Balance according to previous accounting practice - Law no.
6.404/1976
Adjustments referring the effects of the initial adoption of
Law 11.638/2007 and of Executive Act no. 449/2008:
Company:
7,159
(762,139)
Write-off of deferred expenses with studies and projects
Temporary income and social contribution taxes differences
-
-
(292,579)
99,477
Adjust to present value of founders’ shares
7,159
(569,037)
Controlled companies valued under the equity method:
(279,430)
258,654
- Adjustment to present value - ICMS Credits on Fixed Assets
- Adjustment to present value - Decommissioning of Nuclear
Plants
- Write-off of deferred expenses
1,239
(4,659)
106,296
264,686
(892)
(7,646)
- Temporary income and social contribution taxes differences
(36,543)
(88,061)
- New companies valuated under the equity method.
70,618
94,334
- Tax incentives
- Provision for reduction in the recoverable value of assets
(Impairment)
341,360
-
(761,508)
-
Balance according to the current accounting practice
6,136,497
85,618,361
The reclassifications made to the financial statements of December 2007 do not refer to
adjustments stemming from the changes introduced by Law 11.638/2007 of December 28, 2007,
and Executive Act 449/2008 of December 3, 2008. They refer to the effects of the consolidation
of the distribution companies and the reclassification mentioned in note 28.
120
Annual Report 2008
NOTE 4 - SUMMARY OF MAIN ACCOUNTING PRACTICES
The following accounting practices have been adopted in the preparation of the individual
and consolidated financial statements:
I - GENERAL
a) Cash and Cash Equivalents
Stated at cost, they are represented by short-term financial investments, plus yield ob-
tained until the closing date of the financial statements and do not exceed market value
(See note 6).
b) Financial Instruments
Investments are recognized and written-off at the transaction date, within a timetable
established by the market to which they belong. The financial instruments the Company
and its controlled companies keep are classified as: (a) trading financial instruments,
recognized at fair value; and (b) financial assets and liabilities held to maturity.
The classification depends on the purpose to which the financial assets and liabilities
were acquired or contracted, and the Company’s management and its subsidiaries clas-
sify their financial assets and liabilities at the beginning of the operations.
The only financial instruments measured at fair value are derivatives, classified as tra-
ding financial instruments. Financial instruments of that type are classified as current
and are recognized at acquisition cost at the date they are contracted. Subsequently,
they are measured at fair value, and gains or losses recorded as financial income or
expenses for the year.
Other financial instruments comprise financial investments, securities, loans and finan-
cing, held to maturity and measured at contracting cost, plus yield earned, according
to periods and conditions set in the contracts. They are recognized in income under the
accrual basis and are adjusted to their probable realizable value.
c) Accounts Receivable and Allowance for Doubtful Accounts
Trade accounts receivables (consumers and resellers) are composed of receivables from
the electricity sold to final consumers and concessionaires, including those stemming
from the power traded at the Electricity Commercialization Chamber - CCEE.
They are recognized at acquisition cost, less allowance for doubtful accounts based
on a realization risk analysis, at levels the Company’s management and its controlled
companies consider sufficient to cover possible losses (See Attachment I).
Accounts receivable are usually settled in a period of up to 45 days, and for that rea-
son, their book values are represented by fair values at accounting closing dates.
121
Annual Report 2008
d) Loans and Financing Granted
Granted loans and financing and the respective charges recognized until the balance
sheet date are adjusted according to the monetary and exchange variation indexes
established in the contracts (See Attachment II).
e) Investments
Interests held in controlled companies and jointly-owned subsidiaries with stockhol-
ding corresponding to or exceeding 20% of the total capital of investees are valued
under the equity method.
According to CPC Pronouncement 2, in determining the result of the valuation under
the equity method and consolidating interests held in companies with functional cur-
rency different from the one of the investor, gains and losses with exchange variation
during the translation of the Financial Statements into reais should be recognized
under the caption Accumulated Translation Adjustments in Shareholders’ Equity. Sub-
sequently, they should be recorded in the income of the year during the disposal of
the investment.
The statement of operations and shareholders’ equity position of investees valued
under the equity method employing a functional currency different from the one of
presentation of consolidated financial statements should be translated into the conso-
lidation currency.
f) Transactions in Foreign Currency
The balances of monetary items in foreign currency are presented at the prevailing
exchange rate at the balance sheet date.
For non-monetary items valued at cost, the rate used is the one of the date of the
transaction and for non-monetary items appraised at fair value, the rate to be utilized
is the one of the date where the value is determined.
Gains and losses with exchange variation determined during the settlement of opera-
tions or translation into reais of monetary assets and liabilities in foreign currency are
recognized in income.
g) Intangible Assets
Expenditures incurred in obtaining non-physical items are recognized as intangible
assets, in special computer program licenses that are capitalized and amortized over
the license term. Costs associated with the maintenance of computer software are re-
cognized as expense of the year, when incurred.
122
Annual Report 2008
h) Expenses with Studies and Projects
These refer mainly to costs the Company incurs on feasibility studies focusing the
use of hydrographical basins and transmission lines. They are recognized as operating
expense when incurred until the moment that proof of the economic feasibility of its
exploitation is obtained or the concession granted or authorized. After the concession
and/or authorization for exploitation of the service is granted or proof of the economic
feasibility of the project obtained, the Company starts capitalizing expenses incurred
as project development cost.
i) Valuation of the Recoverable Value of Assets
The management of the Company and its subsidiaries annually analyze the recove-
rability of the book value of their assets, or whenever any circumstances indicate
such need. If evidence of non-recoverability is found, the management estimates their
possible recoverable value. When the accounting residual value of the assets exceeds
the recoverable value, a reduction of the carrying amount of the asset is recognized
(impairment). The impairment corresponding to the non-recoverability of the asset or
cash-generating unit is recognized in the income of the year.
When it is not possible or practical to individually estimate the recoverable amount of
an asset, the Company and its subsidiaries obtain an estimation of the possible reco-
very of the cash-generating unit to which the asset belongs. During the determination
of fair value, estimated future cash flows rates used are discounted at present value
based on a discount rate before taxes that reflects market conditions, current money
value at such time and specific risks related to the asset or group of assets.
The recoverable value of an asset or cash-generating unit can be reviewed and, if it
increases in the future, the provision for impairment recognized in the past is fully or
partially reversed, with effects to the income of the year where the recovery is obser-
ved. Then, the book value of the asset is adjusted to its new and probable recovery
value, limited to the original carrying amount of the asset or cash-generating unit.
The recoverable amount, identified by the management of the Company and its subsi-
diaries corresponds to the fair value of the asset, group of assets or cash-generating
unit.
j) Financing and Loans Obtained
Loans and financing obtained are recognized at fair value when the funds are received,
net of the costs of the transaction. After that, they are valued at amortized cost, plus
123
Annual Report 2008
charges, interest and monetary and/or exchange variations determined in the contract
terms, and incurred until the balance sheet date. See Attachment V.
k) Income and Social Contribution Taxes on Net Income
Corporate Income Tax - IRPJ is calculated under the annual taxable income method, at
the rate of 15% and surtax of 10% on taxable income, as defined by the prevailing tax
law. Social Contribution Tax on Net Income - CSLL is calculated at the rate of 9% on
adjusted income under the terms of the applicable law.
In compliance with CVM Decision 273 of August 20, 1998, and CVM Instruction 273 of
August 20, 1998, and CVM Instruction 371 of June 27, 2002, deferred tax assets and
liabilities, calculated on temporary differences and tax losses carryforwards are recor-
ded in current and noncurrent assets and noncurrent liabilities (See notes 12 and 24).
l) Financial Income and Expenses
They are composed of interest, monetary and exchange variations associated with fi-
nancial investments, loans and financing granted and obtained, as well as operations
with financial instruments.
m) Complementary Pension Funds
The Company and its subsidiaries adopt the accounting practices provided by CVM De-
cision 371/2000 for recognition of the actuarial valuation of their employees’ pension
funds. Actuarial gains with defined benefit plans are only recognized up to the value
of the financial instruments not included in the fair value of the foundation’s assets.
Actuarial gains and losses generated by adjustments and changes in actuarial assump-
tions of pension and retirement plans and the actuarial obligation related to medical
assistance plans are recognized in income according to the corridor method.
n) Provisions for Contingencies
Provisions are recognized when a past event can generate a future obligation, whose
probability of utilization of funds and value can be clearly estimated. The value recog-
nized as provision is the best estimate of fulfillment of a probable obligation at the
date of the financial statements, taking into account the related risks and uncertain-
ties.
o) Accounting Estimates
Accounting estimates are those arising from the application of subjective and complex
judgment on the part of the management of the Company and its subsidiaries, fre-
quently stemming from the need of recognizing significant amounts and appropriately
demonstrate the equity position and results of the companies. Accounting estimates
124
Annual Report 2008
become increasingly critic as the number of variable and assumptions that affect the
future condition of those uncertainties increase, making the judgment even more sub-
jective and complex.
In the preparation of these financial statements, the management adopted estimates
and assumptions based on historic and other factors they understand as reasonable and
significant for an adequate presentation of the statements. Even if those estimates and
assumptions are constantly monitored and reviewed, the materialization of the book
value of assets and liabilities and results of operations is inherently uncertain, as they
are the result of judgment.
About accounting estimates deemed more critical, the bases for judgment of future
events, variables and assumptions are as follows:
I) Deferred Tax Assets - the same method used to determine Corporate Income Tax
(IRPJ) and Social Contribution Tax (CSLL) losses is applied in the determination
of deferred IRPJ and CSLL generated by temporary differences between the book
value of assets and liabilities, in addition to their respective tax values to be offset
with tax loss carryforwards. Deferred tax assets and liabilities are calculated and
recognized based on the rates applicable to taxable income in the years where
those temporary differences should be realized. The future taxable income can be
higher or lower than the estimates considered by the management when defining
the need of recognizing or not deferred tax assets.
II) Provision for impairment - the management of the Company and its subsidia-
ries adopt variables and assumptions to test the recovery of long-term assets and
calculate their recoverable value, recognizing impairment where necessary. In this
procedure, judgment is used based on the history of the asset, group of assets or
cash-generating unit. The projected amounts may not be realized in the future,
including the estimated economic useful lives of long-term assets, based on prac-
tices established by ANEEL for concession-linked assets, and could vary during the
periodic analysis of economic useful lives of the goods after January 1, 2009. A
number of inherently uncertain events also have impact on the determination of
the variables and assumptions the management employs in determining the dis-
counted future cash flow to recognize the recoverable value of long-term assets.
Among them, we can mention the maintenance of the electricity consumption
levels, growth in the economic activity rate in Brazil, availability of water, besides
those inherent to the end of the concession periods held by the subsidiary compa-
nies, in special the reversal value at the end of the concession term. The manage-
125
Annual Report 2008
ment has adopted as assumption the compensation established in contract where
applicable, based on the existing residual book value at the end of the concession
period for electric power generation, transmission and distribution. Therefore, ac-
tual results of the estimates used in these financial statements can be different
in the presence of variables, assumptions, and conditions diverse from the ones
existing and used at the time the judgment was rendered.
p) Interest on Equity Capital
For corporate and accounting purposes, the income of the year is directly recognized
into Shareholders’ Equity, observing specific tax regulations that determine that the
interest on equity capital should be recorded in income.
According to legal requirements, the interest on equity capital applied on the dividen-
ds of the year is limited to a percentage of shareholders’ equity and is based on the
Long-Term Interest Rate (TJLP) established by the Brazilian Government. The limit is
the higher between 50% of the net income for the year or 50% of the surplus reserve,
before including the income of the own year.
q) Current and Noncurrent Assets and Liabilities
Assets are demonstrated at their realizable value and liabilities at known or estima-
ted values, plus charges incurred, where applicable. Rights realizable and obligations
maturing after 12 months of the date of the Financial Statements are considered non-
current.
r) Determination of the Result of Operations
Revenue and expenses are determined under the accrual basis.
Tax incentives were recorded in the income statement as a reduction of income tax, in
compliance with CPC Pronouncement 7. The portion of income associated with those
tax incentives was fully recorded under a caption of the Surplus Reserve called Tax In-
centive Reserve, and excluded from the tax basis of mandatory dividends, as provided
by article 195-A of Law no. 6.404/1976. Those funds can only be used for increase in
capital stock or absorption of losses.
II - SPECIFIC PRACTICES OF THE ELECTRIC SECTOR
a) Depreciation of Property, Plant, and Equipment in Service
Depreciation is calculated under the straight-line method, and annual depreciation ra-
tes are estimated in conformity with Instruction ANEEL 44, as of March 17, 1999 (See
note 17 and attachments IV and IV.a.).
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Annual Report 2008
b) Property, Plant and Equipment in Construction
In accordance with the Accounting Manual for Electricity Utilities, interest and other
financial charges (monetary and exchange variation), related to loans obtained with
third parties applied in constructions in progress, are recorded as part of construction
costs.
General management fees are recognized in property, plant, and equipment in cons-
truction. The recognition of direct costs with personnel and third party services is
allowed based on the criteria established by the Regulating Agency (See note 20 and
Attachments IV and IVa).
c) Property, Plant and Equipment
Valuated at acquisition or construction cost, plus interest capitalized during the cons-
truction period, where applicable.
As provided in CPC Pronouncement 13 - Initial Adoption of Law 11.638/2007 and Exe-
cutive Act 449/2008, the Company and its subsidiaries will prepare periodic analysis of
economic useful lives of their goods starting from January 1, 2009. For public service
concession linked goods, the controlled companies will follow the estimate of econo-
mical useful lives established by ANEEL.
Physical assets destined to the maintenance of the activities of the Company and its
subsidiaries associated with lease-purchase agreements are recorded in property, plant
and equipment, with a corresponding entry to financing debt, where applicable. Assets
are subject to depreciation, observing their estimated economic useful lives.
The Company and its subsidiaries review the book value of their long-term assets used
in their operations whenever events or changes in the circumstances indicate that the
carrying amount of an assets or group of assets is not recoverable.
d) Concession-Linked Obligations
Obligations are recorded with a corresponding entry to the contributions received from
the Federal Government and consumers, exclusively for investment in the electricity
distribution grid. Obligation are recorded as reducers of property, plant and equipment,
and at the end of concession, offset against the corresponding assets, including those
acquired with the contributions received from the Government and from consumers.
Public service concession periods are established by ANEEL (See note 17 and Attach-
ments IV and IVa).
127
Annual Report 2008
e) Storeroom
Storeroom materials, classified as current assets, are recorded at the average acquisi-
tion cost. Those destined to the construction of property, plant, and equipment are
classified in noncurrent assets, at acquisition cost. Recognized amounts do not exceed
replacement costs or realizable values.
f) Stemming from the General Electric Sector Agreement
In accordance with the provisions of ANEEL Decision 72 of February 7, 2002, the
amounts referring to the Extraordinary Tariff Adjustment (RTE) are presented in the
account “Consumers and resellers,” as defined in Decision 91 of the Electricity Crisis
Management Chamber - GCE, of December 21, 2001 and Law 10,438, of April 26, 2002
(See note 13).
g) Obligations Assumed for the Release of Assets
As established in the Accounting Manual for Electricity Utilities of ANEEL, a provision
is recognized along the useful economic lives of thermonuclear plants with the purpose
of recognizing the costs to be incurred with their technical-operational deactivation
to the respective accrual period, at the end of their useful lives, estimated as being
forty year.
The amounts recognized to the result of operations are based on annual quotas establi-
shed in American dollars at the ratio of 1/40th of estimated expenditures, immediately
recorded and translated according to the exchange rate of the end of the accrual mon-
th. Liabilities referring to the decommissioning of plants are adjusted according to the
American dollar variation (See note 31).
h) Stocks of Nuclear Fuel
The uranium concentrate in stock, the corresponding services and the available nuclear
fuel elements inside the reactor and in the so-called pool destined to the elements
used, are recorded at acquisition cost.
The consumption of the nuclear fuel elements is recognized to income (loss) of the year
as they are used in the generation of power (See note 14).
i) Scheduled Stops
The costs incurred before and during scheduled stops are initially recorded in Current
assets. After operations are resumed at the plant, the costs are taken to the result of
128
Annual Report 2008
operations in monthly quotas, until the beginning of the next scheduled stop.
j) Fuel Consumption Account (CCC)
Under the terms of Law 8.631 of March 04, 1993, ELETROBRÁS manages the amounts
paid by holders of public electric power service concessions to be credited against the
Fuel Consumption Account (CCC), corresponding to the annual share of expenditure
with fuels for electricity generation. The amounts recorded in current assets, with a
corresponding entry to current liabilities, correspond to the funds available kept in a
blocked bank account and to the shares unsettled by concession holders.
k) Global Reversion Reserve Quota (RGR)
Drafts made by ELETROBRÁS in the account of RGR for concession of loans and finan-
cing to the concession holders are recorded as liabilities. Interest of 5% per annum is
applied on such drafts, starting from the enactment of Law 8.631 in March 04, 1993
(See note 23).
l) Compulsory Loan
It is recorded at principal amount, plus monetary variation, based on the IPCA-E index
and interest of 6% per year (See note 22).
III - SPECIFIC ACCOUNTING PRACTICES OF ITAIPU BINACIONAL
In accounting for its operations, Itaipu Binacional follows accounting practices generally
accepted in Brazil and Paraguay, with due regard for specific provisions of the International
Treaty signed by the Brazilian and the Paraguayan governments on April 26, 1973, which
regulates ITAIPU Binacional. Below, the main provisions departing from accounting practices
applicable in Brazil:
a)
Depreciation of facilities is not recorded, as the revenue is calculated based on
charges on liabilities, not being included in the ”Cost of Electricity Service”, accor-
ding to Attachment C to the Brazil-Paraguay International Treaty;
Retained earnings are not part of the Stockholders’ Equity, being appropriated to
“Results to be Offset” and reclassified to property, plant and equipment; and
In determining the return on equity capital, the realized profits are not taken into
consideration, but shown as operating expenses under “Income.”
b)
c)
129
Annual Report 2008
NOTE 5 - CONSOLIDATION PROCEDURES
I) The Consolidated Financial Statements reflect the balances of assets and liabilities as
of December 31, 2008 and 2007, and the results of the operations for the years then
ended of the Company, its direct and indirect controlled companies and of the ones
with shared control. For equity method and consolidation purposes, financial state-
ments prepared in a functional currency different from the one of the Company are
translated into the currency used in the presentation of the statement in Brazil and in-
clude the figures of ELETROBRÁS and the ones of the following controlled companies:
Furnas
Chesf
Eletrosul
Eletronorte
Eletronuclear
Itaipu Binacional (*)
CGTEE
Eletropar
Ceron
Ceal
Cepisa
Eletroacre
Manaus Energia (**)
Boa Vista Energia (***)
FIDC Furnas I (****)
FIDC Furnas II (****)
(*) Under joint control with ANDE (Paraguay).
(**) Indirect interest through ELETRONORTE until May 2008.
(***) Indirect interest through ELETRONORTE.
(****) Indirect interest through FURNAS.
ELETROBRÁS’S INTERESTS
2008 and 2007
Direct
Indirect
99.54%
99.45%
99.71%
98.68%
99.81%
50.00%
99.94%
81.61%
99.96%
75.16%
98.56%
93.29%
100.00%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
100.00%
100.00%
100.00%
130
Annual Report 2008
II) The Balance Sheets and the Statements of Operations for the years ended December 31,
2008 and 2007 of consolidated companies are summarized in Attachment VI.
III) We presented below the main consolidation practices adopted:
a)
b)
c)
d)
e)
Elimination of the investors’ investments in the investees, with a corresponding
entry to its interests in the respective shareholders’ equitiespartida à sua partici-
pação nos respectivos patrimônios líquidos;
Elimination of intercompany balances receivable and payable;
Elimination of intercompany revenues and expenses;
Separate identification of the interests held by other shareholders in the equity
and in
In view of the non-existence of unrealized income in intercompany operations, the
net income and shareholders’ equity of the controlling company is the same as the
one consolidated.
results of the consolidated investees; and
IV) Consolidation procedures of the controlling company in relation to ITAIPU Binacional
a)
b)
c)
d)
The Financial Statements of ITAIPU Binacional are prepared originally in North
American dollars (functional currency). Assets and liabilities were translated into
reais at the exchange rate published by Brazilian Central Bank on December 31,
2008 - US$ 1.00 : R$2.3370 (US$ 1.00 : R$ 1.7713 on December 31, 2007). Income
accounts were converted at the monthly average rate;
The income to offset of ITAIPU Binacional was adjusted in the consolidated pro-
perty, plant and equipment;
The compensation on equity capital paid by ITAIPU Binacional was recorded as
income of the controlling company and eliminated in the consolidation; and
All income generated by ITAIPU Binacional in the account “Income to offset of
ITAIPU Binacional.” was eliminated in the consolidation.
For analytical purposes, a summary of the consolidated balance sheet and sta-
tement of operations excluding the effects of ITAIPU Binacional’s proportional
consolidation is presented below. It is intended to show the influence of ITAIPU
Binacional’s financial statements in the consolidated financial statements of ELE-
TROBRÁS. Given its specificities, this information should by no means be construed
as representing the consolidated financial statements of ELETROBRÁS.
131
Annual Report 2008
CONSOLIDATED BALANCE SHEET (R$ thousand)
(for informative purposes only)
2008
ExCLUDING ITAIPU
INCLUDING ITAIPU
Assets
Current
Consumers and resellers
Loans and financing
Other
Noncurrent
Long-term assets
Loans and financing
Other
Investments
Property, plant and equipment, deferred
charges, and intangible assets
4,286,208
1,523,743
19,556,500
25,366,451
22,580,924
12,261,085
34,842,009
6,013,715
58,567,363
64,581,078
4,341,459
1,493,271
19,762,927
25,597,657
13,467,643
12,453,282
25,920,925
5,896,865
80,638,485
86,535,350
Total assets
124,789,538
138,053,932
Liabilities and shareholders’ equity
Current
Loans and financing
Trade accounts payable
Other
Noncurrent
Loans and financing
Other
Shareholders’ interest – ANDE
Shareholders’ equity
764,989
3,263,717
9,300,650
13,329,356
6,702,608
18,906,546
25,609,154
232,667
85,618,361
85,851,028
1,714,610
2,594,567
9,977,839
14,287,016
18,297,562
19,618,326
37,915,888
232,667
85,618,361
85,851,028
Total liabilities and shareholders’ equity
124,789,538
138,053,932
132
Annual Report 2008
STATEMENT OF OPERATIONS (R$ thousand)
(for informative purposes only)
2008
ExCLUDING ITAIPU
INCLUDING ITAIPU
Operating revenues
Electricity sale and transmission
Deductions
Other
Operating expenses
Energy purchased for resale
Depreciation and amortization
Itaipu’s income to be offset
Other
Operating income before financial
income
Financial income (expenses)
Income from participating interests held
Other revenues and expenses
Income before Corporate Income Tax
(IRPJ) and Social Contribution Tax (CSLL)
31,285,832
(2,176,281)
791,867
29,901,418
(11,707,884)
(2,339,904)
-
(11,327,052)
(25,374,840)
4,526,578
4,393,502
665,533
(32,951)
31,450,764
(2,176,281)
791,867
30,066,350
(8,832,314)
(2,339,904)
(835,885)
(12,522,627)
(24,530,731)
5,535,619
3,383,768
665,533
(32,258)
9,552,662
9,552,662
CSLL and IRPJ
(3,226,515)
(3,226,515)
Income before ownership interests
6,326,147
6,326,147
Profit sharing
Minority interest
Net income
Earnings per share
133
(176,817)
(12,833)
(176,817)
(12,833)
6,136,497
6,136,497
R$5.42
R$5.42
NOTE 6 - CASH AND CASH EQUIVALENTS
R$ thousand
Company
Consolidated
Cash in hand and in banks
8,548
25,383
2008
2007
2008
169,244
2007
288,334
Financial investments
9,361,493
4,937,593
12,662,756
7,264,721
9,370,041
4,962,976
12,832,000
7,553,055
Restricted Cash
CCC
Commercialization of ITAIPU’s
energy
156,354
212,191
156,354
212,191
151,135
6,991
151,135
6,991
PROINFA
Total
426,897
615,552
426,897
615,552
10,104,427
5,797,710
13,566,386
8,387,789
Cash and cash equivalents are held at Banco do Brasil S.A., under the terms of specific
legislation (Decree Law no. 1.290 of December 3, 1973) applying to mixed-capital companies
under federal control, and amendments arising from the Brazilian Central Bank Resolution no.
2.917 of December 19, 2001, which determined new investment mechanisms for companies
integrating indirect Federal Administration.
Readily realizable short-term investments are part of off-the-market investment funds, the
return on which is calculated based on the Average SELIC Rate.
Annual Report 2008
134
Annual Report 2008
NOTE 7 - MARKETABLE SECURITIES
ELETROBRÁS and its subsidiaries classify securities as held to maturity based on the
management’s strategies for those assets.
Securities held to maturity are recognized at acquisition cost, plus interest and monetary
variation with effects to income. Such instruments are adjusted at their probable realizable
value, where applicable.
NONCURRENT
CFT-E1
NTN-P
Partnership results
Founders’ shares
Other
R$ mil
CONTROLADORA
CONSOLIDADO
2008
2007
2008
2007
208,761
136,160
165,442
90,697
12,314
194,405
126,395
313,145
652,575
3,152
208,761
140,675
165,442
90,697
12,314
194,405
129,737
313,145
652,575
3,152
613,374
1,289,672
617,889
1,293,014
a) CFT-E1 - These non-interest bearing government securities are subject to the General
Market Price Index (IGP-M) variation and mature in August 2012. ELETROBRÁS main-
tains a valuation allowance set up in previous years and adjusted based on discounts
applied in Capital Market corresponding to R$ 105,464 thousand as of December 31,
2008 (R$ 91,761 thousand on December 31, 2007), and shown as a reduction of the
corresponding asset.
b) NTN-P - These securities, received in payment during the investees’ privatization pro-
cess, by the disposal of corporate investments according to the National Privatization
Program (PND). They are remunerated based on the TR – Reference Rate published by
the Central Bank of Brazil, bearing interest at 6% p.a. on the restated value as of the
redemption date as from February 2012.
c) PARTNERSHIP RESULTS - These refer to the revenues receivable on investments, under
a partnership scheme (See note 16), with an average remuneration equivalent to the
IGP-M variation plus interest varying from 12% to 13% p.a. on the capital contributed,
as follows:
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Annual Report 2008
EATE
TANGARÁ
ELEJOR
ITIQUIRA
Other
R$ thousand
COMPANY AND CONSOLIDATED
2008
2007
49,353
64,620
16,226
-
35,243
165,442
60,839
48,181
50,459
122,131
31,535
313,145
d) FOUNDER’S SHARES - These arise from restructuring of investment in INVESTCO S.A.,
with annual earnings in the equivalent to 10% of said companies’ profits, payable to-
gether with dividends and redeemable by October 2032 through conversion in preferred
shares of capital stock in the companies and values listed below:
PAULISTA LAJEADO
LAJEADO ENERGIA
EDP LAJEADO
CEB LAJEADO
Face value
Adjustment to present value
Present value
R$ thousand
COMPANY AND CONSOLIDATED
2008
2007
49,975
266,798
184,577
151,225
652,575
(561,878)
90,697
49,975
266,798
184,577
151,225
652,575
-
652,575
As described in note 2, following Law 11.638/07, such securities should be valuated
at fair value in compliance with CVM Decision 564/2008 that approved CPC Pronoun-
cement-12.
e) Others - Refer to investment certificates of governmental grants destined for projects exe-
cuted by the controlled companies CHESF and ELETRONORTE, called FINOR/FINAM. The Com-
pany keeps a provision for losses, set up based on the market value, corresponding to R$
283,690 thousand (R$ 284,414 thousand on December 31, 2007) and shown as a reduction
of the corresponding asset.
136
Annual Report 2008
NOTE 8 - CONSUMERS AND RESELLERS OF ELECTRICITY
I - The receivables relating to consumers and resellers are detailed in Attach-
ment I to these notes and include the regulatory assets described in item I of
note 13.
II - Sale of the electricity generated by ITAIPU Binacional
Under Law 10.438 of April 26, 2002, ELETROBRÁS is responsible for the sale in Brazil of
the electricity produced by ITAIPU BINACIONAL.
In the year 2008, the equivalent to 86,568 GWh was distributed with the tariff for electri-
city supplied (purchase) by ITAIPU at US$ 21.99/kW and the tariff for energy transfer (sale)
at US$ 23.03/kW.
The results of the ITAIPU Binacional’s electricity sales, under the terms of Decree 4.550, of
December 27, 2002, observing the amendments introduced by Decree 6,265, of November 22,
2007, will be appropriated as follows (See item II, of note 13):
a) If positive, to the Residential and Rural consumers of the National Interconnected Po-
wer System using up to 350 kWh, through apportionment ratably to the individual consump-
tion and credit of bonuses in the electricity bills.
b) If negative, it is included by ANEEL in the calculation of the contracted power tariff in
the year subsequent to the result formation.
In the year 2008, the activity was positive by R$ 389,862 thousand, and respective obli-
gations included in the account “Refund Obligations.”
III - Commercialization of electricity - PROINFA
Sales within the scope of PROINFA generated a positive net income in 2008 of R$ 35,643
thousand (R$ 250,414 thousand on December 31, 2007), not producing effects on ELETROBRÁS’s
net income for the year. That is included under the caption “Refund Obligations.”
IV - Electricity Commercialization Chamber - CCEE
The amounts relating to operations performed in CCEE’s sphere of action are recorded based
on the information given by CCEE itself.
As a result of those operations in 2008, a net credit of R$ 2,585 thousand was generated
for ELETROBRÁS and its controlled companies.
Controlled company FURNAS recorded R$ 293,560 thousand of credits relating to distri-
bution of energy by the former MAE in the period between September 2000 and September
2002. The respective financial settlements have been suspended due to preliminary orders
granted in the course of legal actions filed by electricity distribution concessionaires against
ANEEL and MAE, presently CCEE. Due to the uncertainty of realization, the Company keeps an
137
Annual Report 2008
Allowance for Doubtful Accounts, corresponding to the full amount of credit taken in the last
quarter of 2007.
In accordance with the rules established by the Market Agreement, the resolution of those
disputes would imply a new recording, and the attendant settlement between the parties
would occur without CCEE’s intervention. To this end, negotiations were initiated with the
participation of ANEEL, CCEE and the agents involved, in order to solve judicial disputes con-
nected with the accounting process and liquidation, and enable negotiation of a solution for
those actions.
V - Allowance for doubtful accounts
The Company set up and maintains an allowance for doubtful accounts in accordance with
rules established by ANEEL, based on an analysis of the overdue receivables and past experien-
ce with losses, at an amount deemed sufficient to cover possible losses on any such accounts.
The balance as of December 31, 2008 corresponded to R$ 1,546,967 thousand (R$ 1,749,356
thousand on December 31, 2007), and had the following composition:
R$ thousand
CONSOLIDATED
2008
2007
RTE (Free Electricity - loss of revenue and Portion A)
66,998
309,732
Consumers and resellers
Companhia de Eletricidade do Amapá (CEA)
Other
Short-term energy – CCEE
566,283
620,126
413,302
732,762
1,186,409
1,146,064
293,560
1,546,967
293,560
1,749,356
For taxation purposes, the excess of provision recorded, taking into account the provisions
of Law 9.430/1996 is added to the Taxable Income for IRPJ - Corporate Income Tax - calcula-
tion purposes, and to the CSLL – Social Contribution Tax, too.
138
Annual Report 2008
NOTE 9 - LOANS AND FINANCING GRANTED
Following CPC Pronouncement 14 – Financial instruments, financing and loans granted are
classified as financial assets, to be held to maturity. Financing and loans granted (See Atta-
chment II) and their respective charges are recognized until the balance sheet date and are
adjusted according to monetary or exchange variation indexes established in contracts.
The market values of those assets correspond to their carrying amounts.
Loans and financing are granted with ELETROBRÁS’ own funds, besides funds of the sector,
external funds raised with international development agencies, financial institutions, and
issuance of bonds in the international financial market.
All loans and financing are supported by contracts signed with sector companies. Most of
these amounts are expected to be amortized in monthly installments over an average 10-year
period, at an average of 9.73% p.a. interest rate, weighted by the debt balance.
Loans and financing granted under foreign-currency-restatement clauses represent nearly
50% of the total loan portfolio, whereas those based on indexes representing domestic price
levels account for 24% of the portfolio.
I - Receivables of AES-ELETROPAULO - Lawsuit
In 1989, ELETROBRÁS filed a collection action against Eletropaulo, aiming to receive
credits from financing not settled at the respective maturities, according to criteria and con-
ditions established in the contract clauses.
A decision was rendered in April 1999, whereby ELETROPAULO was condemned to pay the
unsettled financed amount. Subsequently, a final and unappealable decision was rendered,
meaning that ELETROPAULO did not file any appeal against the lower court decision. Therefo-
re, an action for the execution of the decision establishing payment was filed by ELETROBRÁS
at the 5th Civil Court of Rio de Janeiro.
However, in January 1998, there was a partial spin-off of the assets of ELETROPAULO,
giving rise to three different companies - Empresa Metropolitana de Águas e Energia S.A.
(EMAE), Empresa Paulista de Transmissão de Energia S.A. (EPTE) and Empresa Brasileira de
Energia S.A. (EBE). ELETROPAULO - Eletricidade de São Paulo S.A., had its name changed to
Eletropaulo Metropolitana Eletricidade de São Paulo S.A.
ELETROPAULO challenged the legitimacy of the Partial Spin-off Agreement, which was dis-
missed and the continuation of the execution ordered. In December 2003, ELETROPAULO filed
an interlocutory appeal, requesting the suspension of effects against the decision determi-
ning the execution. It was granted due to the understanding that ELETROPAULO would not be
legitimate to bear the execution, but CTEEP – Companhia de Transmissão de Energia Elétrica
Paulista (the former EPTE), due to the effects of the mentioned partial spin-off agreement.
Extraordinary and Special appeals were filed by ELETROBRÁS discussing the decision about
the appeal of ELETROPAULO, being granted in the sense that the execution should continue
and that the defense of ELETROPAULO should be challenged through motion to stay collec-
139
tion filed by the debtor and not through a plea of lack of jurisdiction. ELETROPAULO filed a
motion for clarification of judgment, a special appeal according to specific court regulations
and finally a request for resolution of conflict in decision. A final decision was rendered in
November 2007, denying all the Appeals of ELETROPAULO. After exhausting all possibility of
success before the Superior Court of Justice - STJ, ELETROPAULO presented an extraordinary
appeal to the Supreme Federal Court - STF, which was denied by the decision of a single Judge,
as published on March 28, 2008.
In view of that scenario, the management of ELETROBRÁS will go ahead with the execution
and, supported by the opinion of its legal advisors, considers the realization of the credit as
practically certain.
As of December 31, 2008, such credits corresponded to R$ 385,171 thousand, considering
the original clauses of the contract with ELETROPAULO, which, adjusted according to the inde-
xes practiced by the justice, reach the amount of R$ 1,061,329 thousand. The Company’s ma-
nagement, in a conservative posture, did not record the adjustment portion based on criteria
different from those agreed upon in the contracts, opting to wait for the execution.
II - Allowance for Doubtful Accounts
The Company conservatively maintains a provision for doubtful accounts referring to the
principal and debt service of several defalt other companies in the amount of R$ 117,675
thousand (R$ 80,630 thousand on December 31, 2007). These allowances are deemed suffi-
cient by the Company’s management to cover possible losses on any such accounts, based on
analyses of the portfolio.
Annual Report 2008
140
Annual Report 2008
NOTE 10 - RESCHEDULED RECEIVABLES
CURRENT
CEB
CELG
AES-SUL
CEMAT
Rollover of States’ debts
Other
NONCURRENT
CEB
CELG
AES-SUL
Rollover of States’ debts
Other
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
8,450
63,617
12,288
-
-
16
54,347
48,217
10,227
-
-
12
84,371
112,803
475
181,307
17,852
-
12
1,201
175,636
27,114
-
8
40,807
88,076
12,288
108,694
141,130
228,876
619,871
185,826
467,404
17,852
586,157
813,063
91,834
72,392
10,227
25,034
188,867
137,921
526,275
181,341
476,199
965,006
298,220
199,646
284,017
203,959
316,762
2,070,302
1,920,766
2,690,173
2,447,041
The rescheduled receivables are formalized through agreements stipulating repayment of
accumulated debt in installments and interest rates and monetary restatement, as well as the
term for amortization of the principal and charges. The Company deems all these receivables
recoverable, the following being worth mentioning:
a) Receivables arising from Electricity passed on to CEB
ELETROBRÁS has receivables from CEB arising from sale by FURNAS of electricity gene-
rated by ITAIPU Binacional, which have been subrogated since January 2003. In that
year, these receivables were rescheduled due to default on the part of Distrito Federal
corresponding to R$ 163,892 thousand. Through the rescheduling, among other thin-
gs, the repayment of overdue debt by the end of 2008 (i.e., in 60 months’ time) is
stipulated, with SELIC-rate based restatement and collaterals, through direct transfer
to ELETROBRÁS by the financial institution working for CEB of 4% of the latter’s gross
monthly sales. The amount receivable as of December 31, 2008 was R$ 8,450 thousand
141
Annual Report 2008
(R$ 54,347 thousand on December 31, 2007).
FURNAS also rescheduled receivables from CEB, in the amount of R$ 191,129 thousand,
referring to its own energy, payable in 144 monthly installments beginning in August
2003, each installment corresponding to 3% of its gross sales, with the possibility of
automatic extension to the date of the final payment. As of December 31, 2008, the
balance adjusted according to the IGP-M index, plus 1% interest p.m. was R$ 217,708
thousand (R$ 218,828 thousand on December 31, 2007), from which, and amount of
R$ 185,351 was recorded in noncurrent assets (R$ 181,341 thousand on December 31,
2007). Part of these credit rights corresponding to R$ 162,000 thousand was assigned
to the FIDC – Credit Rights Investment Fund – FURNAS II (See note 23).
b) Receivables from electricity passed on to CELG
In 2003, ELETROBRÁS rescheduled with CELG the receivables arising from ITAIPU
Binacional’s pass-on of energy to CELG and subrogated by FURNAS to ELETROBRÁS, in
the amount of R$ 392,021 thousand. The terms of the rescheduling establish the rea-
lization of those receivables by direct transfer by the financial institution who collects
CELG’s bills, of 3.34% of the latter’s gross monthly sales. The period for the payment
is 216 months from January 2004 on and with the debt balance subject to restate-
ment based on the U.S. dollar variation against the real. The amount receivable as of
December 31, 2008 corresponded to R$ 244,924 thousand (R$223.853 thousand on
December 31, 2007), of which R$ 181,307 thousand was recorded in noncurrent assets
(R$ 175,636 thousand on December 31, 2007).
In a similar way, in December 2003 the controlled company FURNAS rescheduled
R$378,938 thousand, referring to own energy credits, payable in 216 months and sub-
ject to monthly restatement based on the IGP-M variation and bearing interest at 1%
p.m. The monthly payment corresponds to 2.56% of CELG’s gross sales, with guarantee
supported by a blocked bank account. The debt balance as of December 31, 2008, was
R$ 310,557 thousand (R$ 324,738 thousand on December 31, 2007). Part of these
credit rights corresponding to R$ 258,000 thousand was assigned to the FIDC – Credit
Rights Investment Fund – FURNAS II (See note 23).
c) Rollover of States’ debts
In accordance with the Public Sector Financial Recovery Program implemented by Law
No 8.727/93, FURNAS entered into a receivables assignment agreement with the Fede-
ral Government in order to refinance CELG’s power purchase debt existing at that time,
which have been paid in 240 monthly installments since April 1994. Receivables are
restated by the IGP-M at 11% p.a., and amounted to R$ 571,615 thousand as of De-
cember 31, 2008, (R$527,027 thousand on December 31, 2007), of which R$ 458,379
142
thousand was recorded in noncurrent assets (R$ 438,455 thousand on December 31,
2007). Part of these credit rights corresponding to R$ 228,000 thousand was assigned
to the FIDC – Credit Rights Investment Fund – FURNAS II (See Note 23).
Also, the controlled company ELETROSUL had receivables amounting to R$676,230
thousand as of December 31, 2008 (R$ 626,846 thousand on December 31, 2007),
against the Federal Government, which are restated by the IGP-M, bearing interest of
12.68% p.a., arising from the assumption of the controlled company’s rights against
the state-controlled electricity concessionaires, which have been realized since April
1994, in 240 monthly installments.
In accordance with the legislation in force, should any receivable balance still remain
after the 20-year period has elapsed, the repayment may be extended for another 10
years. Such hypothesis is foreseen, since the Federal Government only passes on the
resources actually received from the States, which are legally limited to the commit-
ment of the revenues.
Annual Report 2008
143
Annual Report 2008
NOTE 11 - RETURN ON INVESTMENTS
This refers to dividends and interest on equity capital, net from Withholding Income Tax,
arising from investments of permanent nature held by ELETROBRÁS and breakdowns as follows.
FURNAS
CHESF
ITAIPU Binacional
ELETROSUL
ELETRONUCLEAR
ELETROPAR
CEMAR
CTEEP
Other
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
251,607
541,878
14,022
135,713
28,749
8,268
48,340
102,156
82,233
164,121
238,680
10,628
46,842
27,893
-
57,990
33,295
55,908
1,212,966
635,357
-
-
-
-
-
-
-
-
-
-
-
-
48,340
102,156
110,597
261,093
57,990
33,295
61,183
152,468
NOTE 12 - TAx CREDITS AND DEFERRED TAx ASSETS
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
CURRENT ASSETS
Withholding income tax (IRRF)
749,478
1,386,390
818,616
1,448,174
Prepaid Corporate Income Tax (IRPJ) and
Social Contribution Tax (CSLL)
663,844
383,218
776,102
397,724
Tax loss carryforwards
Temporary IRPJ/CSLL differences
-
-
-
-
28,880
19,423
293,631
408,102
PASEP/COFINS (taxes on sales) to be offset
5,031
3,607
Recoverable ICMS (State VAT)
Other
-
-
-
-
74,308
72,169
18,144
50,381
67,899
89,296
1,418,353
1,773,215
2,081,850
2,480,999
144
Annual Report 2008
The above tax credits will be offset upon filing of the Company’s 2009 Income Tax Return
for calendar year 2008 against corporate income and social contribution tax liabilities (See
note 24).
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
NONCURRENT
Recoverable ICMS
Tax loss carryforwards
-
-
-
-
Provision for interest on equity capital
583,187
239,185
Temporary differences
Provision for contingencies
Allowance for doubtful accounts
Provision for reduction in market value
Adjustment as per Law 11.638/07 - RTT
PIS/COFINS
Other
-
-
481,718
457,407
67,155
48,874
132,312
102,077
-
-
781,341
948,318
-
583,187
173,062
481,718
40,874
50,895
239,185
83,549
469,115
69,527
127,899
132,312
130,049
-
-
-
564,384
-
-
460,216
30,070
535,575
1,348,168
1,351,862
2,786,948
2,526,213
Deferred tax credits refer to temporary differences in IRPJ and CSLL tax bases, and will be
used as these differences are realized.
Considering the Company’s profitability record and the expected taxable income generation
in the next years, the recognition of those assets depends on the realization of the recorded
deferred tax assets. This realization is grounded in the analysis of future trends and technical
studies based on internal assumptions, macroeconomic, commercial and tax scenarios that
may change in the future.
Given the nature of tax credits, their realization is expected for the next five to eight fiscal
years, when triggered by taxable events.
Circular Letter no. 2.775/2008 - SFF/ANEEL of December 24, 2008, provides among other
things procedures for the closing of the Financial Statements of 2008 of concession holders,
the return to the Fuel Consumption Account of the amounts corresponding to PIS/PASEP and
COFINS credits taken on the fuel acquired for the generation of electricity under the non-
cumulative system in period between 2004 and 2008.
The management of the subsidiary company Manaus Energia understood until the year
2007 that the fuel bought to generate power, subsidized by CCC, did not entitle rights to cre-
145
Annual Report 2008
dits in the determination of PIS/PASEP and COFINS and acted accordingly. In view of the new
facts, the management of that controlled company, based on the opinion of their legal coun-
selors, gathered information on all acquisitions of oil made in the period ANEEL established,
determining a tax credit of R$ 460,493 thousand that was recognized in Noncurrent assets,
observing the assessment periods of the last five years.
The use of the tax credits recognized in 2008 depends upon the future operations that
generate debt, a fact that, in the opinion of the management of that subsidiary, will occur,
even if the oil is replaced by natural gas as input in the generation of electricity.
However, to avoid possible risks of the statute of limitations period of such credits recog-
nized under the provisions of Laws 10.637/2002 and 10.833/2003, the management of the
controlled company, instructed by their legal advisors, filed a motion to toll the statute of
limitations with the Federal Government.
The corresponding CCC debits related to ICMS (State VAT) are recognized at their original
values and at the ratio established in Law 8.631/1993. The one referring PIS/PASEP and
COFINS (sales taxes) were determined observing the amounts that exceed the percentages
defined in Law 8.631/1993. However, ANEEL, through Technical Note SFF/ANEEL no. 359/08
of August 11, 2008, expressed the understanding that the reimbursement should be made at
the full recoverable value.
The management of the controlled company, supported by their legal advisors, requested
at court the suspension of the effects of the mentioned regulating agency’s decisions, that is,
Decisions ANEEL 432/2007 and 303/2008 and Circular Letter 2.775/2008 - SFF/ANEEL, that
had their effects suspended.
Unconstitutionality of PIS/PASEP and COFINS: The Supreme Court declared unconstitutional
the section 1, art. 3 of Law 9.718/98, which expanded the PIS/PASEP and COFINS tax bases,
and renewed the billing concept so it now encompasses all revenues earned by legal entities,
regardless of the type of activity carried out and the accounting classification adopted. That
provision had no legal supporting basis, which is why it was subsequently amended.
Based on the CTN, Brazilian Tributary Code, the ELETROBRÁS System’s companies filed an
appeal claiming for recognition of the right to, and actual reimbursement of the amount paid
in excess, because the expansion of PIS/PASEP and COFINS tax bases is unconstitutional. To
the date of completion of these financial statements, the claims had not been judged.
The ELETROBRÁS System’s companies hold potential PIS/PASEP and COFINS credits waiting
for a decision, and therefore, not recognized on these Financial Statements, given that the
decision on the unconstitutionality of the matter only benefits the companies whose appeals
have already been judged.
146
Annual Report 2008
NOTE 13 - REGULATORY ASSETS
I - General Agreement for the Electricity Sector
In 2001, the Brazilian electricity sector was subjected to an Emergency Electricity Con-
sumption Reduction Program, with the Federal Government forming the Electricity Crisis Ma-
nagement Chamber to manage demand adjustment programs, coordinate actions to increase
energy supply, and implement emergency measures during the rationing period which lasted
from June 1, 2001 to February 28, 2002.
Under Law 10.438/2002, which put into practice the legal instruments for implementation
of the General Electric Sector Agreement due to the Reduction Program, ANEEL was authorized
to implement the RTE – Extraordinary Tariff Adjustment, with the objective of standing up to
the financial impact on the Brazilian Interconnected Electric System, then under the effect of
the said program.
In that scenario, electricity generating companies recognized credits related to ‘free ener-
gy’, revenue loss and ‘Portion A’, realizable under the terms of the General Agreement for the
Electricity Sector, through Extraordinary Tariff Adjustment (RTE) and collected from final con-
sumers, with variable maturities defined by ANEEL for the different distributors.
In compliance with Circular Letter ANEEL 2.409, of December 14, 2007, the Company
recognized losses stemming from ‘free energy’ not billed by distributors within the period
established in the regulations, corresponding to R$ 268,612 thousand (R$ 299,686 thousand).
That is recorded in the account “Losses in the recovery of assets” in the group of operating
expenses, which was fully accrued for until the fourth quarter of 2007.
The net residual amounts deriving from the General Electric Sector Agreement which were
recorded as regulatory assets can be seen under “Consumers and Resellers” (See Attachment
I) as follows:
RTE – Portion A, Free Energy and Generating Company Reimbursement
Balance as of December 31, 2007
(-) Losses
(-) Actual
Realizable balance as of December 31, 2008
Allowance for doubtful accounts
Balance as of December 31, 2007
(+) Reversal
(-) Recognition
Realizable balance as of December 31, 2008
CONSOLIDATED
(R$ thousand)
526,702
(268,612)
(160,213)
97,877
(309,732)
257,309
(14,575)
(66,998)
30,879
147
Annual Report 2008
Under the terms of the mentioned ANEEL Circular Letter No. 2,409/2007, the realizable ba-
lance corresponding to ‘free energy’, net of losses already recognized, is R$ 97,877 thousand
(R$526,702 thousand on December 31, 2007) and will receive the same treatment in case it is
not realized within the established periods. Most of the amounts will mature by 2009.
In accordance with the terms of the same ANEEL Circular Letter, and supported by studies
prepared by management, the Company has set up an allowance for doubtful accounts of
R$66,998 thousand on December 31, 2008 (R$ 309,732 thousand on December 31, 2007),
deemed sufficient to cover possible losses that may be sustained until the end of the realiza-
tion period.
II - Resulting from the sale of electricity generated at ITAIPU Binacional
Pursuant to Law No. 11.480/2007 the adjustment rate applied to the financing contracts
entered into with ITAIPU Binacional and the credit assignment agreements entered into with
the Federal Treasury starting in 2007 was withdrawn. Accordingly, ELETROBRAS is entitled to
fully maintain its flow of receipts.
Besides, Decree 6.265 of November 22, 2007 was also issued with the purpose of regu-
lating the sale of ITAIPU Binacional’s electricity, defining the different rate to be applied
to the energy transfer rate, creating a regulatory asset for the annual difference calculated,
corresponding to an annual adjustment factor taken from financing contracts to be annually
included in the energy transfer rate starting in 2008.
Accordingly, from 2008, the rate charged for transferring the energy from ITAIPU Binacio-
nal includes the difference caused by the elimination of the annual adjustment factor, whose
amounts should be annually defined through an Interministry Ordinance issued by the Finance
Ministry and Ministry of Mining and Energy. The energy transfer rate in effect in 2008 includes
an amount of R$ 502,429 thousand, (or US$ 214,989 thousand), approved by the Finance
Ministry and Ministry of Mining and Energy Interministry Ordinance No. 398/2008.
The balance of regulatory assets represented by the caption “Rights to reimbursement” in
non-current assets results from the sale of ITAIPU Binacional’s electricity in the period from
January to December 2008. It totals R$ 4,312,809 thousand, corresponding to US$ 1,845,447
thousand.
Therefore, the loss of financial revenue of ELETROBRÁS caused by the elimination of the
adjustment factor from financing contracts executed with ITAIPU Binacional was offset by its
addition to the energy transfer tariff, not generating losses to the Company.
The method for determination of the regulatory asset was defined by Interministry ordi-
nance MME/MF 313/2007 of December 11, 2007.
148
NOTE 14 - NUCLEAR FUEL INVENTORIES
The nuclear fuel used in Angra I and Angra II thermonuclear plants comprises elements
produced with metal alloys and uranium pellets.
In this initial stage, the uranium ore, and the services required for its production are acqui-
red and accounted for as non-current long-term assets under Nuclear Fuel Inventories. After
the production process is finished, the portion to be consumed during the following 12 months
is classified as current assets under the caption “Storeroom.” As of December 31, 2008, the
amount totals R$ 323,064 thousand (R$ 286,315 thousand on December 31, 20067.
The monthly amortization is recognized as operating expenses in a proportionate manner,
taking into account the energy actually generated monthly, in comparison with the total ener-
gy calculated for each fuel element. Periodically, inventories and assessments of the nuclear
fuel elements, which have been through the electricity generation process and are stored at
the spent fuel deposit, are performed.
Nuclear fuel inventories for the operation of Angra I and Angra II thermonuclear plants
were as follows as of December 31, 2008:
NONCURRENT
Nuclear fuel inventories
Uranium concentrate
Ready elements
Storeroom supplies
Ongoing services - nuclear fuel
R$ thousand
CONSOLIDATED
2008
2007
104,442
146,736
259,213
214,751
725,142
71,301
194,633
242,615
148,639
657,188
Annual Report 2008
149
NOTE 15 - ADVANCES FOR AN INCREASE IN PARENT COMPANY’S OWNERSHIP
INTEREST
The amounts referring to advances for future capital increase of the companies listed be-
low are recorded by ELETROBRÁS under Noncurrent assets:
FURNAS
CHESF
ELETROSUL
ELETROPAR
ELETRONORTE
ELETRONUCLEAR
CEAL
ELETROACRE
Eletroacre
Other investments
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
31,154
294,397
94,576
62,285
-
-
158,300
85,542
726,254
4,027
730,281
31,154
294,397
94,576
62,285
1,337,552
264
121,675
80,553
2,022,456
4,027
2,026,483
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,027
4,027
4,027
4,027
ELETROBRÁS decided to pay in the entire advance for future increase in capital granted to
ELETRONORTE, during general meetings that controlled company held on May 28, 2008 and
December 11, 2008.
Annual Report 2008
150
Annual Report 2008
NOTE 16 - INVESTMENTS
Equity in earnings of controlled
companies
a) Controlled companies
(Attachment III)
b) Affiliated companies
CEEE-D (b)
CEEE-GT (b)
EMAE (b) (c)
CEMAT (b) (c)
CTEEP (a) (c)
CEMAR (a)
CELPA (b)
LAJEADO ENERGIA (a) (c)
CEB LAJEADO (b) (c)
EDP LAJEADO (a) (c)
PAULISTA LAJEADO (b) (c)
ENERPEIXE (d)
STN (d)
ARTEMIS (d)
SC ENERGIA (d)
RS ENERGIA (d)
UIRAPURU (d)
ETAU (d)
TRANSLESTE (d)
TRANSIRAPÉ (d)
TRANSUDESTE (d)
CENTROESTE DE MINAS (d)
CHAPECOENSE (d)
INTESA (d)
AMAZÔNIA – AETE (d)
ENERGÉTICA (d)
SERRA DO FACÃO (d)
RETIRO BAIXO (d)
BAGUARI ENERGIA (d)
BRASNORTE (d)
AMAPARI (d)
ENERGIA SUSTENTÁVEL (d)
Other (d)
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
39,935,810
39,344,716
-
-
9,499
127,368
267,765
456,883
1,447,818
197,943
366,953
219,806
78,173
103,771
23,380
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
18,951
105,234
252,219
455,384
1,393,534
169,790
379,584
218,446
61,233
102,957
23,380
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,299,359
-
3,180,712
9,499
127,368
267,765
456,883
1,447,818
197,943
366,953
219,806
78,173
103,771
23,380
420,960
112,780
68,142
110,396
61,847
20,212
12,487
13,420
6,029
8,500
6,514
270,855
91,566
25,200
123,970
273,713
67,188
61,925
39,600
41,423
100,004
6,473
5,242,563
18,951
105,234
252,219
455,384
1,393,534
169,790
379,584
218,446
61,233
102,957
23,380
350,763
97,020
64,976
69,005
73,492
19,600
11,713
11,896
5,474
7,500
6,440
230,000
73,505
21,300
74,240
95,743
-
-
-
-
4
48,888
4,442,271
151
Annual Report 2008
c) Acquisition cost
CESP
CELESC
AES TIETÊ
COELCE
CDSA
SAELPA
EATE
TANGARA
ELEJOR
GUASCOR
ITIQUIRA
Other investments
COMPANY
CONSOLIDATED
2008
2007
2008
2007
268,679
268,679
268,679
268,679
28,241
23,046
15,328
11,801
11,272
16,960
21,738
9,829
3,300
-
37,355
447,549
28,241
23,046
15,328
11,801
11,272
17,548
28,016
44,606
3,300
41,339
43,534
536,710
28,241
23,046
15,328
11,801
11,272
16,960
21,738
9,829
3,300
-
244,108
654,302
28,241
23,046
15,328
11,801
11,272
17,548
28,016
44,606
3,300
41,339
257,691
705,867
43,682,718
43,062,138
5,896,865
5,193,138
(a) Financial statements audited by other independent auditors.
(b) Audit opinion of the independent auditors related to the Financial Statements not
available until the closing date of these financial statements.
(c) It does not have an interest in voting capital. However, it has a significant influence
on the Company’s management.
(d) Indirect interests through subsidiaries of the Company.
Several lawsuits against ELETROBRÁS are under way, whose proceedings are at different
stages (See Note 30). The assets below, representing 6.32% of the total investment portfo-
lio, were pledged as guarantee for the Company to appeal against court decisions on these
lawsuits:
152
Annual Report 2008
Investments
Investment amount
Blocking percentage
Blocked investment
R$ thousand
R$ thousand
CTEEP
EMAE
CESP
AES TIETÊ
COELCE
DUKE
CEMAT
CEB
CELPA
CELPE
CELESC
CEEE-GT
Other investments
1,447,818
267,765
269,679
23,046
15,328
3,344
456,883
3,528
366,953
4,689
28,241
127,368
3,014,642
40,668,076
43,682,718
91.71%
100.00%
95.82%
89.19%
100.00%
62.48%
86.64%
50.00%
96,99%
71.55%
15.24%
87.39%
-
6.32%
1,327,794
267,765
258,406
20,555
15,328
2,089
395,843
1,764
355,908
3,355
4,304
111,307
2,764,418
-
2,764,418
Over the last few years ELETROBRÁS entered into partnerships in projects with private
investors in which ELETROBRÁS acts as minority stockholder, owning preferred shares. These
enterprises’ objective is to operate in the electricity generation and transmission areas. The
invested amounts are classified as Noncurrent assets - Investments.
Likewise, considering the needs of investment of the Electric Sector and in accordance
with the Federal Government’s intention to obtain new resources under the conditions esta-
blished by Law 10.438/2002, the ELETROBRÁS’ controlled companies participate as minority
shareholders in companies formed to exploit the electricity service concessions. These opera-
tions are classified as Acquisition Cost – Others where applicable.
a) ENERPEIXE - Refers to the 40% interest of FURNAS in the capital stock of Enerpeixe S.A,
which has as purpose the construction and operation of UHE Peixe Angical, located by the
river Tocantins, whose generation capacity is 452 MW. It started operations in May 2006.
b) Empresa Sistema de Transmissão Nordeste S.A (STN) was formed by CHESF and Alusa -
Cia. Técnica de Engenharia Elétrica for exploitation of a 546 km, 500 kV transmission line con-
cession in the region between Teresina (State of Piauí) Sobral and Fortaleza (State of Ceará).
The capital of Empresa Sistema de Transmissão Nordeste S.A. is distributed in the following
proportion: Alusa holds 51% and CHESF 49% of the capital stock of STN. The enterprise was
concluded in December 2005 and commercial operations began in January 2006.
153
Annual Report 2008
c) TRANSLESTE – A specific purpose company incorporated in 2003 with the objective
of implanting and exploiting for a period of 30 years a transmission line connecting Montes
Claros and Irapé (both in the State of Minas Gerais), with a voltage of 345 kV, and 150 km of
extension. The interest of the controlled company FURNAS in that company corresponds to
24% of capital stock. The operation of the transmission line started in 2005.
d) TRANSIRAPÉ - A company incorporated in 2004, with the purpose of constructing, ope-
rating, and maintaining the facilities of the electricity transmission line between Irapé and
Araçuaí (both in the State of Minas Gerais), with a voltage of 230 kV and 65 km of extension.
The interest that FURNAS holds in that company corresponds to 24.5% of capital. The opera-
tion of that transmission line started in 2007.
e) ARTEMIS Transmissora of Energia S.A. - is a company whose objective is the exploitation
of 525 kV transmission lines, connecting Salto Santiago and Ivaiporã and Ivaiporã and Casca-
vel D’Oeste, where the controlled company ELETROSUL holds 46.5% of the shares. Operations
began in October 2005.
f) SC ENERGIA - Empresa Transmissora de Energia Elétrica de Santa Catarina S.A. is a com-
pany whose objective is the exploitation of a 375 Km, 525 kV transmission line, connecting
Campos Novos with Blumenau (both in the State of Santa Catarina). ELETROSUL holds 100%
participating interests in its capital stock. Operations began in September 2006.
g) TRANSUDESTE - a company incorporated in 2004, with the purpose of implanting and
exploiting for a period of 30 years the transmission line connecting Itutinga with Juiz de Fora
(both in the State of Minas Gerais), with a voltage of 345 kV, and 140 km of extension. The
interest that FURNAS holds in that company corresponds to 25% of capital. The operation of
that transmission line started in 2007.
h) CENTROESTE DE MINAS - company incorporated in 2004 with the objective of implanting
and exploiting for a period of 30 years the transmission line connecting Furnas and Pimenta
(both in the State of Minas Gerais), with a voltage of 345 kV, and 75 km of extension. The
interest that FURNAS holds in that company corresponds to 49% of capital.
i) Chapecoense Geração S.A. – A specific purpose company that has as objective to build
and exploit UHE Foz do Chapecó, located by river Uruguai. FURNAS holds interest of 49% in
the capital of the company that will manage the plant, with capacity of 885 MW, which will be
operated by the consortium composed of CPFL, with 51%, CHAPECOENSE, with 40%, and CEEE
GT with 9% interest. FURNAS will be responsible for the performance of engineering activities.
The operation of the first machine is projected to start in 2010.
j) RS ENERGIA - Empresa de Transmissão de Energia do Rio Grande do Sul - A specific pur-
pose company organized in 2005, for the construction, operation and maintenance of 274 Km
of 525 kV transmission lines, connecting Campos Novos (State of Santa Catarina) and Nova
Santa Rita (State of Rio Grande do Sul), with a concession period of 30 years. The beginning of
operations is projected to the first half of 2009. ELETROSUL holds 100% of shares representing
the capital of RS ENERGIA.
154
Annual Report 2008
k) Uirapuru Transmissora de Energia S.A. - Empresa de Transmissão de Energia do Rio Gran-
de do Sul. A specific purpose company organized in 2004, for the construction, operation and
maintenance of the 274 Km, 525 kV transmission line, connecting Ivaiporã and Londrina (both
in the State of Paraná), with a concession granted for 30 years. ELETROSUL holds 49% of sha-
res of Uirapuru, and the company Cymi Holding S.A. holds the remaining 51%. The operation
of the transmission line started in 2006.
l) ETAU - Empresa Transmissora do Alto Uruguai S.A. - A specific purpose company or-
ganized for the construction, operation and maintenance of a 187 Km, 230 kV transmission
lines, connecting Campos Novos and Barra Grande (both in the State of Santa Catarina), with
a concession granted for 30 years. ELETROSUL holds 27.4% of the shares of the capital stock
of ETAU, and the companies Terna Participation S.A., DME Energética Ltda., and Companhia
Estadual de Energia Elétrica – CEEE hold 52.6%, 10%, 10% respectively. The operation of that
transmission line started in 2005.
m) INTESA - Integração Transmissora de Energia S.A. - A specific purpose company incor-
porated for construction, implantation, operation, and maintenance of a 500 kV Transmission
line connecting Colina and Serra da Mesa 2, 3rd circuit, with a concession granted for 30 ye-
ars. The capital of INTESA is distributed as follow: ELETROBRÁS holds 49% (CHESF - 12% and
ELETRONORTE - 37%) and Fundo de Investimentos em Participações Brasil Energia - FIP, holds
51%. Commercial operations started in 2008.
n) Amazônia Eletronorte Transmissora de Energia S.A. - A specific purpose company in-
corporated for the construction, operation, and maintenance of 2 transmission lines with
capacity of 230 KV, connecting Coxipó and Cuiabá (both in the State of Mato Grosso), with an
extension of 25 km and from Cuiabá to Rondonópolis (also in the State of Mato Grosso) with
an extension of 168 km. It started is operations in September 2005. ELETRONORTE holds 49%
of the capital stock of AETE.
o) Energética Águas da Pedra S.A. - A specific purpose company had as origin the Aripuanã
Consortium, for contracting of energy from new enterprises, with subsequent grant of a con-
cession within the Regulated Contracting Environment, for implantation of UHE Dardanelos.
ELETROBRÁS holds 39% interests of in that company (CHESF – 24.50% and ELETRONORTE.
24.50%) together with Neoenergia S.A. that holds 51%. The Plant will be implanted by river
Aripuanã, located in the northern region of the State of Mato Grosso, with an assured capacity
of 261 MW, and total energy of 154.9 average MW. The first machines are scheduled to start
operations in 2011, and 147 average MW were sold for the period 2011 to 2041, within the
30 year-concession period.
p) Serra do Facão S.A. - A specific purpose company incorporated with the objective of
constructing and operating UHE Serra do Facão, with an installed capacity of 210 MW, located
by the river São Marcos, in the State of Goiás. The stockholding of FURNAS in the mentioned
consortium through Serra do Facão Participações S.A. is 79.79%. The beginning of operations
of the first machine is projected to 2010.
155
Annual Report 2008
q) Consórcio MESA S.A. - A specific purpose company organized in 2007 with the objective
of building and operating the project of construction of UHE Santo Antônio, by river Madei-
ra, in the State of Rondônia. FURNAS holds 39% interests in the capital stock of Consórcio
MESA. Odebrecht Investimentos holds 17.6%), Andrade Gutierrez Participações 12.4%, CEMIG
10%, Fundos de Investimentos e Participações da Amazônia 20% and Construtora Norberto
Odebrecht 1%.
r) RETIRO BAIXO – A specific purpose company organized with the purpose of implanting
and managing UHE Retiro Baixo, with an installed capacity of 82 MW, located by River Parao-
peba, along the municipalities of Curvelo and Pompeu. FURNAS holds interests of 49% in its
capital stock. The work started in March 2007 and the beginning of the commercial operation
of the first machine is projected to January 2009.
s) BAGUARI ENERGIA - A specific purpose company incorporated to implant and operate
UHE Baguari, located by River Doce, in the State of Minas Gerais, with capacity of 140 MW and
implantation projected to the second half of 2009. FURNAS holds interests corresponding to
30.61% in its capital stock.
t) ENERGIA SUSTENTÁVEL DO BRASIL S.A. - A specific purpose company that aims to ope-
rate the concession and sale of power from UHE Jirau, by River Madeira, State of Rondônia,
with minimum installed capacity 3,300 MW, and beginning of operations projected to 2013.
ELETROBRÀS holds 40% participating interests in the capital of the company (CHESF 20% and
ELETROSUL 20%) together with the companies Suez Energy South America Participações Ltda.
(50.1%) and Camargo Corrêa Investimentos em Infraestrutura S.A. (9.9%). The concession
period is 35 years.
u) Brasnorte Transmissora de Energia S.A – A specific purpose company organized in 2007,
with the objective of managing the public service concession of Transmission Line Juba -Jau-
ru, a lined of 230 kV, with 129 Km of extension; Transmission Line Maggi – Nova Mutum, 230
kV line, with 273 Km of extension; Subestation Juba, (230/138 kV) and Substation Maggi
(230/138 kV). ELETRONORTE holds 45% in interests in that company, TERNA PARTICIPAÇÕES
S/A holds 35% and BIMETAL IND. E COM. DE PRODUTOS METALÚRGICOS LTDA holds 20%.
v) Amapari Energia S.A. – A specific purpose company organized in 2007 in a partnership
between MPX Energia S.A. and ELETRONORTE. Its purpose is being an Independent Producer of
Electricity, with initial installed capacity of 23.33 MW. That is a diesel-based thermoelectric
plant (UTE), located in the Municipality of Serra do Navio, in the State of Amapá. ELETRONOR-
TE hold 49% interests in its capital and MPX Energia holds 51%.
x) ELETRONET – The controlled companies FURNAS, CHESF, ELETROSUL, and ELETRONOR-
TE started operating the transmission of information signals, using part of their electricity
transmission infrastructure, with intermediation of the controlled company LIGHTPAR, in a
joint venture with private companies, where it holds minority interest in the capital stock
of ELETRONET, a company formed specifically for rendering feasible the business of providing
transmission for information signals and telecommunication services
156
Annual Report 2008
To assure the feasibility of the business, the companies identified the need of an associa-
tion with private companies and with a company of ELETROBRÁS system to be an intermedia-
te, and act as representative on behalf of the companies and under their guidance in achieving
the business targets in the use of their infrastructure along with the private partner.
ELETROPAR holds minority interest in the capital of Eletronet S.A. - ELETRONET (49%) and
acts as the representative of the interests of the other companies electricity supplying com-
panies controlled by ELETROBRÁS. ELETROPAR transfers the earnings of the business to the
other companies, and is compensated for the management service. The expenses it incurs in
relation to that business are refunded.
Since September 20, 2002, ELETROPAR assumed the management of ELETRONET, due to
delinquency on the part of the majority shareholder - AES Bandeirante Empreendimentos
Ltda. - in contributing with the value of monetary restatement referring to the fourth portion
of capital stock.
In 2003, the administrative council of ELETRONET, decided to declare it bankrupted, as
all possible other measures to assure its maintenance and reach a final solution had been
exhausted.
The declaration of bankruptcy was approved in the extraordinary meeting at ELETRONET,
held in April 2003, which authorized the managers to take all applicable legal measures.
In May 2003, ELETRONET, represented by its managing partners, requested the filing of its
statement of bankruptcy with the Judiciary, together with a preliminary request to continue
in business. The 5th Business Bankruptcy Court declared the bankruptcy under the requested
manner. In that condition, ELETRONET continued its operations under the management of the
Judiciary.
In June 2006, ELETROPAR along with Bankrupt ELETRONET S.A. was notified by CHESF,
ELETRONORTE, ELETROSUL, and FURNAS, called assignor companies, about the termination of
contract no. ECE-1166/99, executed with ELETROPAR on June 29, 1999 and its amendments.
The referred contract allowed the transfer to ELETRONET, as well as the reimbursement of 50%
of the cost incurred by the latter in the management of the communication structure. We
point out, however, that such termination does not cancel the rights of receiving the credits
corresponding to the due reimbursements payable and collectible until December 31, 2006.
Based on contract clauses, the assignor companies claim the following out of the court: i) to
regain possession of the assets comprising the implemented infrastructure for the rendering
of telecommunications services; ii) the right to claim the optical cables; and iii) determining
the maintenance of the essential services to the national integrated electricity transmission
system, as well as the continuance of the services rendered by ELETRONET employees. On the
same date, the assignor companies filed an injunction at the 5th Business Lower Court of Rio
de Janeiro about the issue mentioned above, which was granted, on January 14, 2008, and
which still waits for the deposit in the checking account of ELETRONET’s bankrupt estate of the
amount of R$ 380,000 thousand, determined according to the report drawn up by an expert.
157
In view of that decision, the assignor companies and LT BANDEIRANTES EMPREENDIMENTOS
Ltda. (successor of AES Bandeirantes Empreendimentos Ltda and partner of ELETROPAR in
ELETRONET S/A) and the bankrupt estate of ELETRONET S.A. filed Interlocutory appeal against
interim decision. Neither an interim relief nor a stay of proceedings was granted in any of the
cases.
It is worth mentioning the existence of an understanding on the part of the 5th Bankruptcy
Court, dated May 09, 2007, included in page 4.781 of the bankruptcy proceedings, declaring
that there is no evidence of bankruptcy crime, a fact that, besides the statute of limitations
occurred on May 15, 2007, made unnecessary the execution of a court investigation.
I) Corporate Restructuring of Controlled Companies
On March 28, 2008, during a shareholders meeting, the Companhia Energética do Amazo-
nas S.A. - CEAM approved its merger by Manaus Energia S.A. - MESA, a wholly-owned subsidiary
of Centrais Elétricas do Norte do Brasil S.A. - ELETRONORTE. ELETROBRÁS held 97.96% of the
capital stock of CEAM and holds 98.66% of the capital of ELETRONORTE.
Because of the merger, a provision for CEAM’s investments in the amount of R$697,150
thousand was fully reversed with an offsetting entry to operations in the first quarter of 2008.
The provision for shareholders’ deficit corresponding to R$657,508 thousand was also reversed
in the first quarter, totaling a reversal of R$1,354,658 thousand.
At the same time, the Company’s management recognized the loss in the realization of
the asset corresponding to the investment in CEAM, based on an appraisal report prepared to
support the merger process of CEAM, by MESA that corresponds to R$ 1,436,223 thousand,
recognized through debit to the income (loss) of the first quarter of 2008. The operation has
an effect of R$ 81,565 thousand the on the numbers of 2008.
CEAM and MESA supply electricity to the interior and the capital of Amazonas State,
respectively. The transaction, made in compliance with ELETROBRÁS’ Corporate Governance
policy, created a single company to serve Amazonas State as a whole and will provide more
operating synergy.
Annual Report 2008
158
Annual Report 2008
NOTE 17 – PROPERTY, PLANT AND EQUIPMENT
The value of property, plant and equipment items, detailed in Attachment IV and IVa, is rectified
taking into account obligations arising from the Public Electricity Service concession, which com-
prise amounts received from the Federal, State and the Municipal Governments and the consumers,
as well as donations not committed to return to the donor. Settlement is due for the end of the
respective concession. Property, plant and equipment breakdown as follows:
Participating interests of the Federal Government
Amortization
Consumers’ contributions
Donations and grants for investment
Other
CONSOLIDATED
R$ thousand
2008
2007
744,613
82,416
62,672
291,079
168,469
445,168
82,416
49,279
486,167
248,886
1,349,249
1,311,916
a) Federal Government’s Participation - this refers to funds received from the federal go-
vernment to be used in priority electricity generation and transmission works.
b) Amortization and reversals - originated from the “Amortization Reserves” set up until
1971, under the Federal Decree no. 41.019/57, which were used for expanding the Public
Electricity Service until that year.
c) Consumers’ contributions - these refer to resources received to enable conducting the
necessary enterprises for meeting unforeseen electricity demand and not projected in the
service expansion planning.
d) Donations and grants for investment - refer to pure and simple donations, not conditio-
ned on any return to the donor, and grants for investments in the Public Electricity Service.
According to the Federal Decree 41.019, of February 26, 1957, assets and facilities used in
generation, transmission, distribution, and commercialization are linked to these activities,
and accordingly, cannot be removed, disposed of, assigned or hypothecated without the Re-
gulating Agency’s prior and express authorization.
I) Recovery Value of Assets:
In compliance with CPC Pronouncement 1 - Reduction in the Recoverable Value of Assets,
the management of the Company and its subsidiaries valuated this year, and will appraise on
an yearly basis, or whenever the circumstances require a new valuation, the recoverability of
long-term assets, specially property, plant and equipment held and used in operations. That
159
Annual Report 2008
aims to identify possible depletion of those assets or groups of assets that could lead to
partial recovery.
The Company defined as cash-generating unit all generation, transmission, and distri-
bution assets. Therefore, a detailed analysis per plant, transmission line, or other groups of
assets is not prepared.
The Company’s management, supported by their legal counselors, considered the reversal
of the residual net value of assets at the end of the electric power public service concession,
at book value. The Company also took into consideration the depreciation, based on the useful
lives of the asset, and not the concession term.
During the determination of fair value, estimated future cash flows rates were used that
are discounted at present value based on a discount rate before taxes. They reflect market
conditions, current money value at such time and specific risks related to the asset or group
of assets.
The Company recognized in income an amount of R$ 770,231 thousand as a provision for
reduction in the recoverable value of assets (impairment).
NOTE 18 - INTANGIBLE ASSETS
Specific expenses with the formation or acquisition of rights, including the ones on sof-
tware programs, are recorded in this account, plus respective implantation costs, where appli-
cable. They are amortized under the straight-line method.
In service
(-) Reintegration
In progress
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
61,114
(7,408)
-
53,706
61,114
(5,556)
-
55,558
357,822
(78,388)
96,377
375,811
429,986
(21,345)
65,844
474,485
160
Annual Report 2008
NOTE 19 - TRADE ACCOUNTS PAYABLE
Includes, mainly, the energy purchased from ITAIPU Binacional (See note 8, item II),
which breaks down as follows:
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
CURRENT
Goods, material, and services
206,241
51,805
1,170,045
1,182,007
Electricity network use
-
-
3,038
97,982
Energy purchased for resale
1,445,709
1,188,771
1,376,508
1,060,773
Short-term energy - CCEE
24,121
28,789 44,976
135,382
1,676,071
1,269,365
2,594,567
2,476,444
NOTE 20 - ADVANCES FROM CONSUMERS
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
-
15,381
15,381
-
202,250
202,250
37,778
15,381
53,159
35,191
202,250
237,441
-
-
15,381
202,250
1,018,488
1,071,647
1,056,761
1,294,202
CURRENT
ALBRÁS
PROINFA
NONCURRENT
ALBRÁS
I - Albrás
In 2004, the controlled company ELETRONORTE was the outbidder in the electricity auction
organized by ALBRÁS for the sale of electricity to be supplied for a 20-year, equivalent to
750 MW on average per month until December 2006 and 800 MW on average per month from
January 2007 to December 2024. ALBRÁS set a parameter for agreeing on a minimum price
compatible with the UHE Tucuruí’s balanced tariff, plus a premium calculated based on the
aluminum price in London’s commodities exchange.
Under these conditions, ALBRÁS made an energy purchase pre-offer, with a view to redu-
cing the base price. The prepayment for this offer is constituted by energy credits for amorti-
161
Annual Report 2008
zation over the supply period, in fixed monthly installments in medium MW, at the tariff ruling
on the month of sale.
The schedule for prepayment is as follows:
R$ thousand
COMPANY AND CONSOLIDATED
Advances received
2004
2005
2006
2007
Total
Amortization
Total liabilities
II - Proinfa
2008
300,000
500,000
250,000
150,000
1,200,000
(143,734)
1,056,266
2007
300,000
500,000
250,000
150,000
1,200,000
(108,048)
1,091,952
Established by Law 10.438/2002 and its amendments, PROINFA’s purpose is the diversifica-
tion of the Brazilian energetic matrix and the search for regional solutions based on renewable
electricity sources, available input and the applicable technology, given the increased parti-
cipation in electricity production from those sources.
The program guarantees to ELETROBRÁS the purchase of the energy to be produced for a
period of 20 years from 2006. This energy will be transferred to distribution concessionaires,
free consumers and self-producers, excluding low-income consumers, in the proportion of its
use.
Distribution and transmission concessionaries pay ELETROBRÁS the annual value of the
costing quota corresponding to the participation of captive and free consumers and self-pro-
ducers connected to its electricity facilities in twelfth parts, in the month prior to the month
when energy consumption is properly recognized.
In addition to the regular payments of the current year quotas to PROINFA generators, dis-
tribution and transmission concessionaires advanced the payment of one twelfth of the annual
quota, considering the total contracting of all projects carried out under PROINFA.
Accordingly, as of December 31, 2008, the Company had an amount of R$ 15,381 thousand
(R$ 202,250 thousand on December 31, 2007), which will be demanded as PROINFA develops
and the corresponding supply of electric power.
162
Annual Report 2008
NOTE 21 - LOANS AND FINANCING OBTAINED
The breakdown of loans and financing obtained, including charges, whose funds are as-
signed to the investment program of ELETROBRÁS System, is presented in Attachment V (See
note 43).
ELETROBRÁS performed the following fund raising operations, during the year 2008:
a) Conclusion, in August 2008, of the process to obtain a syndicated loan, of the type
A/B Loan, with Corporación Andina de Fomento – CAF. The loan, at an amount US$ 600,000
thousand, was structured in the following manner: Part A, of US$ 150,000 thousand, with CAF,
with a period of 12 years; Part B, corresponding to US$ 450,000 thousand, with a union of
banks, led by Citi, BNP Paribas and Societé Generale, with a term of 7 years.
The contracted average interest rate was 1.64% over 6-month LIBOR, corresponding to its
actual cost.
b) Contracting of a loan with Kreditanstalt für Wiederaufbau – KfW, at an amount of
€37,200 thousand, with surety of the Brazilian Federal Government. In December 2008, the
contracts referring the first € 13,300 tranche was executed between ELETROBRÁS and the
bank. The funds will be used in the projects of construction of 4 small water-based plants,
under the responsibility of ELETROSUL.
c) Beginning of the process to obtain authorization from the National Treasury to raise
US$400,000 thousand, under the form of bonus in the international market. However, after
obtaining the authorization at the end of November 2008, the bonus market lost its attracti-
veness, a fact that determined the postponing of the mentioned issuance. The authorization
already obtained is valid for the year 2009.
d) Negotiation with IBRD and regulatory agencies were started to obtain a loan of
US$500,000 thousand, destined to the Company’s investment program.
I - Credit Rights Investment Fund (FIDC)
a) FIDC FURNAS I
1.
2.
3.
4.
5.
6.
Set up by its administrator, Banco Santander Brasil.
The assignment to Fundo FURNAS I was formalized through a Private Instrument
of Receivables and Other Assets Assignment and Acquisition signed in September
2004.
The discount rate is 1.38% p.a.
The assignment flow is restated based on the annual SELIC rate set by Central Bank
of Brazil (BACEN) for the period from the assignment date to the last business day
before the payment date.
The controlled company FURNAS remained as the collection agent.
The assignment was performed under Furnas’ co-obligation to pay for the Receiva-
bles, as provided under the Brazilian Civil Code.
163
Annual Report 2008
7.
Assigned receivables:
R$ thousand
Receivables Assigned
Realization Period
Amount Assigned
RTE
Jan/2007 to Jan/2008
Financing - CEMAT
Oct/2004 to Mar/2009
Energy - PROMAN
Oct/2004 to Dec/2006
Total assigned
126,000
164,000
52,000
342,000
b) FIDC Furnas II
1.
2.
3.
4.
5.
6.
7.
Jointly set up by Banco Santander Brasil and Bradesco, BB Banco de Investimento,
Itaú BBA and Votorantim, under administration of BEM Distribuidora de Títulos e
Valores Mobiliários LTDA.
The assignment to Fundo FURNAS II was formalized through a Private Instrument
of Receivables and Other Assets Assignment and Acquisition signed in May 2005.
The discount rate is 1,80% p.a.
The assignment flow is restated based on the annual SELIC rate set by Central Bank
of Brazil (BACEN) for the period from the assignment date to the last business day
before the payment date.
The controlled company FURNAS remained as the collection agent.
The assignment was performed under Furnas’ co-obligation to pay for the Receiva-
bles, as provided under the Brazilian Civil Code.
Assigned receivables:
R$ thousand
Receivables Assigned
Realization Period
Amount Assigned
Receivables - Law 8.727/93
Jun/2005 to May/2010
Energy refinancing - CEB
Jun/2005 to May/2010
Energy refinancing - CELG
Jun/2005 to May/2010
Sundry agreements
Jun/2005 to Feb/2008
Total assigned
228,000
162,000
258,000
255,050
903,050
The consolidated statements, under Securities and Exchange Commission (CVM) Instruc-
tion no. 408/2004 and taken into account the characteristics of the funds, consider the
receivables as an integral part of assets, recorded under the original captions, and the FIDC’s
assets amount reflected as long-term and short-term financing and loans, whose total balance
as of December 31, 2008 was R$ 311,907 thousand (R$ 583,715 thousand on December 31,
2007). See Attachment V.
164
Annual Report 2008
NOTE 22 - COMPULSORY LOAN
The Compulsory Loan, instituted by Law 4.156/62 to fund the expansion of the Brazilian
electricity sector, was extinguished by Law 7.181 of December 20, 1983, which established
the end of the collection term for December 31, 1993.
In the first phase of that compulsory loan, ended with enactment of Law 1.512/76, which
levying reached several classes of energy consumers and taxpayers’ credits were represented
by Bearer Bonds that ELETROBRÁS issued.
In a second moment, after the enactment of the cited Law, the compulsory loan started
being paid only by industries with monthly consumption exceeding 2,000 kWh and taxpayers’
credits no longer were represented by bearer bonds, which ELETROBRÁS simply started recog-
nizing.
The remaining credits of the Compulsory Loan, after the fourth conversion into capital,
on April 30, 2008, of the credits constituted from 1988 to 2004, are recorded as current and
noncurrent liabilities maturing as from 2008 and continue to be remunerated at 6% p.a. plus
monetary restatement based on the Extended Consumer Price Index (IPCA-E) variation. These
funds corresponded to R$ 215,071 thousand as of December 31, 2008, (R$ 299,084 thousand
on December 31, 2007), of which R$ 129,866 thousand is recorded as noncurrent (R$ 202,375
thousand on December 31, 2007).
I - Conversion of compulsory loan credits into shares
In 2008, there was the 4th conversion of the shares representing the capital stock of
ELETROBRÁS into class B nominative preferred shares. That comprised all the compulsory loan
credits as of December 31, 2007, corresponding to 202,375 thousand, taken after the 3rd
conversion approved in a extraordinary meet held on April 28, 2005.
The issuance price of the stocks will take as basis the book value per share of ELETROBRÁS
as of December 31, 2007, corresponding to R$ 70.79, under the terms of article 4 of Law
7.181/83.
II - Bearer Bonds issued by ELETROBRÁS
The Bearer bonds issued because of the compulsory loan do not constitute securities, are
not negotiable at Stock Exchanges, do not have quotation and are unenforceable. Therefore,
the management of ELETROBRÁS clarifies that the Company does not have outstanding de-
bentures.
The issuance of those bonds was associated with a legal obligation and not with a business
decision of ELETROBRÁS. In a similar way, the bondholders did not follow an action of will,
but a legal obligation under the provision of Law 4.156/62. Therefore, the provisions of Law
6.404/76 are not applicable to those bonds or of ones addressed by Law 6.385/76.
The Brazilian Securities and Exchange Commission (CVM), in the decision rendered to the
administrative proceeding CVM RJ 2005/7230, filed by the holders of the mentioned bonds,
165
stated that “the obligations issued by ELETROBRÁS in association with Law 4.156/62 cannot
be considered securities.”
Securities and Exchange Commission (CVM) understood that there are no irregularities in
the procedures ELETROBRÁS adopted in its financial statements in relation to the mentioned
obligations or in the disclosure of the existing lawsuits claiming the redemption of those
bonds (See note 30).
Besides, the non-enforceability of the Bearer Bonds was reinforced by a recent decision of
the Superior Court of Justice corroborating the understanding that those notes are not deben-
tures and should not be used to guarantee executions.
The Bearer Bonds issued in the first phase of the compulsory loan, as decided by the
Brazilian Securities and Exchange Commission (CVM), should not be confused with debentu-
res. Besides, as provided by article 4, paragraph 11 of Law 4.156/62 and article 1 of Decree
20.910/32, they are unenforceable, a condition confirmed by Notice 344 of the Superior Court
of Justice (STJ), which established that those bonds cannot be used as guarantee of execu-
tions for not having liquidity and not being debentures.
Therefore, the balance of the Compulsory Loan refers solely to the 1988 – 1994 period
residual credits held by industrial consumers with consumption above 2,000 kWh, that is, the
second phase of that compulsory loan, as well as to the unclaimed interest related to those
credits, as follows:
CURRENT
Interest payable
NONCURRENT
Credits received
R$ thousand
COMPANY
2008
2007
85,205
96,709
129,866
215,071
202,375
299,084
Annual Report 2008
166
NOTE 23 - GLOBAL REVERSION RESERVE QUOTA - RGR
A fund created by the Federal Government to cover expenses with compensation of rever-
sals of electricity power public concessions. The funds, while not used for their purpose, are
invested in the granting of financing to expand the Brazilian electricity sector, improvement
of services and execution of the programs of the Brazilian Federal Government.
The Global Reversion Reserve (RGR) quota is funded by contributions from the concession
holders of the public electricity service, which provide a quota for the reversal and expropria-
tion of electricity services equivalent to up to 2.5% of the amount invested by concession
and permission holders, limited to 3% of gross annual revenues. The value of the quota is
computed as part of the service cost of those entities (See note 4, Item I. k).
The concessionaires deposit their annual quotas for the Global Reversion Reserve (RGR) in
twelve equal parts, up to the last business day of each month, in a bank account created for
this specific purpose. ELETROBRÁS manages the account in compliance with Law No. 5.655/71
and subsequent amendments.
Accordingly, ELETROBRÁS uses RGR funds in specific investment projects, as follows:
I - Expansion of electricity distribution services;
II - Incentive to alternative electric power sources;
III - studies of inventory and feasibility of using water resources;
IV - Implantation of power generators up to 5,000 kW, intended exclusively for public
services in communities using an isolated electricity system;
V - Efficient public lighting;
VI - Electricity conservation through improvement in the quality of products and services;
VII - Universalization of the access to electricity;
The Reserve is remunerated at 5% p.a., according to the funds used. The funds withdrawn
as of December 31, 2008, to invest in the projects described above totaled R$ 7,193,770
thousand (R$ 6,769,011 thousand on December 31, 2007).
Annual Report 2008
167
Annual Report 2008
NOTE 24 - TAxES AND SOCIAL CONTRIBUTIONS
Income Tax
Current liabilities
Noncurrent liabilities
Social contribution tax
Current liabilities
Noncurrent liabilities
PASEP and COFINS (taxes on sales)
Current liabilities
Noncurrent liabilities
ICMS (State VAT)
Current liabilities
Noncurrent liabilities
PAES (Tax Debt Refinancing Program)
Current liabilities
Noncurrent liabilities
Other
Current liabilities
Noncurrent liabilities
TOTAL
Current liabilities
Noncurrent liabilities
COMPANY
CONSOLIDATED
2008
2007
2008
2007
928,955
694,031
763,721
1,041,225
1,016,985
-
1,187,824
381,949
343,291
249,851
280,669
-
417,942
428,870
318,900
138,756
69,366
28,234
186,139
156,678
-
-
-
-
-
-
-
-
-
38,639
-
93,940
45,764
107,444
45,718
129,140
121,454
958,697
1,071,754
22,242
19,936
207,340
234,333
-
53,870
52,494
2,307,736
1,092,560
4,789,390
3,646,465
1,363,854
1,092,560
2,075,726
1,955,794
943,882
-
2,713,664
1,690,671
Obligations referring Corporate Income Tax (IRPJ) and Social Contribution Tax on Net Income
(CSLL) regarding the year 2008 will be fully offset with existing tax credits. (See note 12).
a) Tax Incentives - SUDENE
Executive Act 2.199-14 of August 24, 2001, amended by Law no. 11.196 of November
21, 2005, allows companies located in the Northeast region to reduce the value of the
income tax payable to invest in installation, expansion, modernization or diversifi-
cation projects. That is contingent upon having enterprises within the infrastructure
sector considered a priority for the development of the region, as established by an act
of the Executive Branch.
168
Annual Report 2008
In 2008, the controlled company CHESF obtained the right to a 75% reduction in in-
come tax, calculated on operating income. Such incentive was granted for the years
between 2008 and 2017.
The abovementioned tax incentive totaled R$ 343,251 thousand in 2008, and was
recorded in the income of the year as a reduction to the income tax, in compliance
with CPC Pronouncement 7. The portion of income related to those incentives was fully
recorded under a surplus reserve called ‘Tax incentives reserve’ and excluded from the
tax basis of the mandatory dividend, pursuant to the provisions of article 195-A of
Law 6.404/1976. Those funds can only be used to increase capital stock or to absorb
losses.
b) Reconciliation of income and social contribution tax expense
The reconciliation of IRPJ and CSLL amounts recorded as expenses in the years 2008
and 2007and those calculated at nominal rates is as follows:
COMPANY
2008
2007
IRPJ
CSLL
IRPJ
CSLL
Income (loss) before IRPJ and CSLL
8,481,396
8,481,396
1,401,020
1,401,020
Total IRPJ and CSLL calculated at the
rates of 25% and 9%, respectively
2,120,349
763,326
350,255
126,092
Effects of add-back (deductions):
Revenue from dividends
Equity in loss
(22,161)
(57,028)
(7,978)
(200,971)
(20,530)
(211,343)
Interest on equity capital
(428,814)
(154,373)
(175,872)
Losses with investments
Provision for reduction in the market
value
Other add-backs (deductions)
-
71,985
16,428
-
143,794
25,915
-
-
14,780
(52,839)
16,027
(72,349)
(76,083)
(63,314)
51,766
Total IRPJ and CSLL expenses
1,700,759
621,140
(146,976)
(17,861)
c) Tax Debt Refinancing Program - PAES
The controlled companies FURNAS, ELETROSUL, ELETRONORTE, MANAUS, and CEAL op-
ted for the Special Tax Debt Refinancing Program (PAES). The rescheduled amount is
169
Annual Report 2008
payable in up to 180 months and the debit balance is restated based on the Long-term
Interest Rate (TJLP).
The debt payable under PAES as of December 31, 2008, is as follows:
PAES balance as of December 31, 2006
Monetary restatement
Payments made
ILL (Net income tax) credit offset
Adjustment to balance based on the variation
of the Long-Term Interest Rate (TJLP)
PAES balance as of December 31, 2007
Monetary restatement
Inclusion of debits
Payments made
PAES balance as of December 31, 2008
NOTE 25 - REGULATORY FEES
CURRENT
Global Reversion Reserve Quota – RGR
CCC (Fuel Consumption Account) / CDE (Energy Development
Account)
Financial compensation of water resources
Inspection feed – ANEEL
PROINFA (Alternative Electricity Sources Incentive Program)
Other
CONSOLIDATED
R$ thousand
1,328,256
78,407
(121,403)
(7,872)
(99,020)
1,178,368
44,549
2,535
(137,615)
1,087,837
R$ thousand
CONSOLIDATED
2008
2007
99,039
33,112
536,133
11,965
27,427
609
708,285
71,559
30,615
382,438
4,416
27,692
25,248
541,968
170
Annual Report 2008
NOTE 26 - SHAREHOLDERS’ COMPENSATION
Under the Company’s by-laws, stockholders are entitled to a minimum compulsory dividend
of 25% of net income, adjusted in accordance with the Brazilian corporate law, respecting the
minimum remuneration of 8% of capital stock for the preferred class “A” shares and 6% for
preferred class “B” shares.
The table below demonstrates the adjusted net income and the value of the mandatory mi-
nimum dividend, under the terms of Law 6.404/76, as well as, the total value of compensation
proposed to stockholders, to be approved in a general ordinary meeting:
Net income
Legal reserve
Adjusted net income
R$ thousand
COMPANY
2008
2007
6,136,497
1,547,857
(306,824)
(77,393)
5,829,673
1,470,464
Mandatory minimum dividend - 25%
1,457,418
367,616
Compensation proposed to shareholders in the form of interest on
equity capital
Common shares
Class “A” preferred shares
Class “B” preferred shares
Proposed compensation per share in reais
Common shares - 6.4283% of capital (2007 – 1.8714%)
Class “A” preferred shares - 9.4118% of capital (2007 - 9.4118%)
Class “B” preferred shares - 7.0711% of capital (2007 – 7.0588%)
(*) 2007 considers a reverse stock split
1,343,855
363,416
319
371,080
1,715,254
297
339,773
703,486
2008
2007
1.48
2.17
1.63
0.40
2.02
1.51
Therefore, ELETROBRÁS recorded an amount of R$ 1,715,254 thousand as compensation to
stockholders and interest on equity capital referring the year 2008, which was added to the
minimum obligatory dividend in accordance with the statutory provisions.
Under prevailing tax legislation, withholding income tax is levied at the rate of 15% on
the remuneration proposed to stockholders as interest on equity capital.Shareholders’ com-
171
Annual Report 2008
pensation for the year 2008 corresponds to 29.41% of adjusted net income under the terms
of Law 6.404/76 (2007 - 41.65%) and will be restated based on the SELIC rate, established
by the Brazilian Central Bank, according to the terms of Decree 2,673 of July 16, 1998 that
regulates the payment on the part of federal state companies of dividends or interest on
equity capital.
The adjustment is applicable for the period starting on January 01, 2008 to the date where
it is started the payment of the compensation. Such date will be decided during a general
ordinary meet, where the financial statements will be analyzed and the proposed destination
for income of the year established. There will be the levying of Withholding Income Tax at the
rate of 20% on the portion referring to the monetary restatement according to SELIC.
In compliance with CVM Decision 207/96, and to meet tax standards, ELETROBRÁS accoun-
ted for that interest against financial expenses, taking them to a specific account, opting to
not present them in the statement of operations to not produce an effect on the income of
the year, but only the effects recognized in the accounts of social contribution and income
taxes.
Under the decision of the 48th ordinary general meeting, held on April 30, 2008, the pay-
ment of the compensation to shareholders related to the year 2007 in the form of interest on
equity capital, started on June 30, 2008 for shareholders registered as of May 2, 2008, paid
as follows:
Type /Class
Common shares
Class “A” Preferred shares
Class “B” preferred shares
In reais / per thousand shares
Gross value as of
Dec. 31, 2007
Adjusted gross value
as of Jun. 30, 2008
0.401555200
2.019497311
1.514622982
0.423939988
2.129057146
1.596792859
The balance of compensation to stockholders demonstrated in current liabilities contains
a portion of R$ 198,968 thousand (R$ 177,516 thousand on December 31, 2007) regarding
unclaimed compensation of the years 2005, 2006 and 2007.
According to the terms of the Company’s by-laws, the period for payment of the unclaimed
compensation referring to the year 2004 and preceding years is expired.
172
Annual Report 2008
NOTE 27 - PAYABLES TO THE BRAZILIAN FEDERAL TREASURY
R$ thousand
COMPANY AND CONSOLIDATED
CURRENT
NONCURRENT
Acquisition of interests in CEEE-GT and CEEE-D
62,231
50,439
362,601
2008
2007
2008
2007
386,888
302,279
37,822
-
2,450,772
7,711
40,828
58,150
2,854,201
726,989
Rights to reimbursement (See note 13)
Other
-
10,005
72,236
NOTE 28 - COMPLEMENTARY PENSION FUNDS
Pension Plan and Other Benefits to Employees
1. COMPANY
1.1 - Pension plan
ELETROBRÁS sponsors ELETROS, a pension plan fund with its own equity segregated from
that of the sponsor. The objective of ELETROS is to manage a pension plan for supplementing
the retirement and pension benefits of the sponsor’s employees who enroll.
ELETROS manages two benefit plans sponsored by ELETROBRÁS, detailed as follows:
a) Defined benefit, that offers the following pension plans:
o
o
o
o
o
o
o
Complementary disability benefit
Complementary benefit for years of service (or years of contribution);
Complementary special benefit and veteran pension;
Complementary benefit for age;
Additional retirement income
Pension
Annual bonus benefit
Besides the abovementioned benefits, the defined benefit plan entitles the following ri-
ghts: minimum benefit, redemption of contributions, deferred proportional benefit, self-spon-
soring and annual minimum guarantee.
173
Annual Report 2008
b) Defined contribution plans that offer the following benefits:
o
o
o
o
o
o
o
o
o
Normal retirement benefit
Anticipated retirement benefit
Disability benefit
Death benefit
Unemployment benefit
Minimum benefit
Assured benefit
Annual bonus benefit
Portability
The actuarial regime of capitalization prevails, with periodic valuations carried out in
accordance with private pension funding regulations, which are reported to an inspection
agency and are under the control of the Brazilian Social Security Ministry.
The Company adopts the procedures recommended by CVM Decision no. 371/2000, and
annually performs an actuarial revaluation of the benefit plan it sponsors, as well as of the re-
quired actuarial liability coverage associated with post-employment benefits. The criteria and
assumptions adopted in that independent revaluation follow standards recommended by CVM
and IBRACON and can differ from those adopted by the management of the program, which
follows specific laws, therefore, impeding a simple comparisons of results.
The contributions charged as administrative expenses corresponded to R$ 19,968 thousand
in the year ended December 31, 2008 (R$ 12,073 thousand on December 31, 2007).
As of December 31, 2008, following the provisions of CVM Decision no. 371/2000, the
present value of the Company’s obligations with the complementary pension plan program was
R$ 1,927,732 thousand. Accumulated assets and investments in the financial market through
ELETROS, at the same date, corresponded to R$ 2,045,822 thousand, revealing an excess co-
verage of R$ 118,090 thousand.
CVM Decision no. 371 allows the Company to recognize only the portion of actuarial gain
or loss exceeding 10% of the total Actuarial Obligation or of the total Guaranteed Assets (the
higher between the two amounts). The excess should be recognized in a period equals the
average remaining time of service the beneficiaries have to render to the Company until reti-
rement. As of December 31, 2008, that corresponded to 8.6 years.
After such deferral, the Company opted for not booking the resulting net assets of
R$357,348 thousand, following the application of Rule 49.g, of CVM Decision 371/2000.
Although those plans are separately appraised, the statement of liabilities and assets of
the Company’s pension plan program is consolidated.
We demonstrate below the breakdown as of December 31, 2008 of the obligation referring
the Company’s pension plan program, according to the rates applicable of item 81 of CVM
Decision 371/2000.
174
Annual Report 2008
POPULATION
DB Plan
DC Plan
Total
2008
1. Active participants
2. Beneficiaries:
2.1. Retired employees
2.2. Pensioners
Sum (2)
Total (1+2)
551
1,007
1,315
304
1,619
2,170
44
-
44
1,051
1,558
1,359
304
1,663
3,221
POPULATION
DB Plan
2007
DC Plan
Total
1. Active participants
2. Beneficiaries:
2.1. Retired employees
2.2. Pensioners
Sum (2)
Total (1+2)
480
1,186
261
1,447
1,927
142
11
-
11
153
622
1,197
261
1,458
2,080
Participant Ages:
DB Plan
DC Plan
DC Plan
DC Plan
2008
2007
1. Active participants
1.1. Average age
1.2. Credited services (total)
1.3. Time until retirement
2. Retired employees
2.1. Average age
3. Pensioners
3.1. Average age
49
20.2
8.6
-
65.9
-
63
43.3
-
14
-
57
-
-
48
20
8
-
65.7
-
-
53
-
-
-
56
-
-
175
Annual Report 2008
R$ thousand
2008
ACCUMULATED (GAINS) LOSSES
DB Plan
DC Plan
(a) At beginning of year
(b) Stemming from obligations of the year
(c) Arising from guaranteed assets
(d) Amortization
(e) At end of year
(f) Deferral limit
(g) Deferral period (years)
(h) To be recognized in the following year
205,651
21,760
(3,718)
-
223,694
154,938
8.6
7,994
Total Consolidated
Value
205,651
21,760
(3,718)
-
223,694
154,938
8.6
7,994
-
-
-
-
-
-
-
-
R$ thousand
Projection for 2009
PERIODIC COST OF THE PLAN
PLANO BD
PLANO CD
TOTAL CONSOLIDADO
(a) Service cost
7,104
2,486
(b) Interest cost
143,550
35,369
(c) Return expected on assets
(136,492)
(56,650)
d) Contributions of participants
(3,546)
(e) Amortization
7,995
-
-
9,590
178,919
(193,142)
(3,546)
7,995
Total short-term cost
18,611
(18,795)
(185)
R$ thousand
RECONCILIATION OF LIABILITIES - 2008
Total net (liabilities) /assets
Value at beginning of year
Cost of current services
Cost of interest
Expected yield on the assets of the plan
Amortization
Actuarial gains or losses
Contributions paid
Benefits paid by the plan
302,815
(5,647)
160,972
-
-
176
Annual Report 2008
Changes in the plan
Entrance of participants - DC Plan
Anticipated reduction in obligations
Advanced elimination of obligations
Special unemployment benefits
Other expenses
Other adjustments - Effect of Rule 49.g
Value at end of year
R$ thousand
FLOW OF PAYMENTS OF LONG-TERM BENEFITS
DB Plan
DC Plan
Total
115,425
116,904
118,235
119,933
121,880
123,444
124,460
124,387
123,827
123,029
121,783
119,782
117,060
114,375
110,959
10,202
11,834
14,473
16,812
19,517
21,949
23,958
25,713
27,408
28,761
29,913
30,838
31,351
31,758
32,464
Year
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
-
-
-
-
-
357,349
125,627
128,738
132,708
136,745
141,397
145,393
148,418
150,100
151,235
151,790
151,696
150,620
148,411
146,133
143,423
1.2 - Other Benefit Programs
Life Insurance Program
The Company sponsors 82.08% of the life insurance prizes of a group life insurance policy
for active employees, but extends the possibility of adhesion to retired employees of any type,
provided that they paid the full premium. Post-employment liabilities are identified, seeing
177
Annual Report 2008
that the premium is collective and standardized for both populations (active and retired em-
ployees). As the premium separately calculated for inactive employees is significantly higher
than the one of active employees, there is a transfer of amounts between the retired and acti-
ve populations of the premium paid, including the subsidy the Company gives. As of December
31, 2008, the obligation was R$ 46,676 thousand to be recognized in 8.6 years.
II - CONSOLIDATED
Besides ELETROS, which is sponsored by ELETROBRÁS, the controlled companies of ELETRO-
BRÁS sponsor their own pension funds organized in a similar way, with the objective of sup-
plementing their employees’ retirement and pension benefits through benefit and contribution
plans. Below, a list of these funds:
Sponsor
FURNAS
CHESF
ELETROSUL
ELETRONORTE, MANAUS and BOA VISTA
ELETRONUCLEAR
ITAIPU
CGTEE
CEAL
Pension fund
REAL GRANDEZA
FACHESF
ELOS
PREVINORTE
NUCLEOS and REAL GRANDEZA
FIBRA (Brazil) and CAJA (Paraguay)
ELETROCEEE
FACEAL
Each controlled company established their own programs, determining technical standards
and assumptions different from those adopted by the Company, as described below:
Contributions, which are charged to administrative expenses, totaled R$ 277,632 thousand
in the year ended December 31, 2008 (R$ 299,448 thousand on December 31, 2007).
In accordance with the plan’s regulations and IBRACON’s technical pronouncement appro-
ved by CVM Deliberation no. 371/2000, the companies perform an actuarial evaluation of their
obligations arising from supplementary benefits granted to employees, the need for coverage
of which is reflected in the financial statements corresponding to R$ 2,069,701 thousand,
thus divided: R$ 502,699 thousand under the current liability portion (R$ 368,950 thousand
on December 31, 2007) and R$ 1,567,002 thousand as the noncurrent portion (R$1,841,685
thousand on December 31, 2007), under the caption Supplementary pension plans.
In 2007, the controlled companies FURNAS and ELETRONUCLEAR recorded in the income for
the year, the portion related to the surplus from the actuarial revaluation of post-employment
benefits related to contracts executed with Fundação Real Grandeza, corresponding to R$
1,137,904 thousand, introduced as a reducer of liabilities. In 2008, for a better presentation,
and in compliance with CVM Decisions 489/2005 and 371/2000, the Company started presen-
ting such portion under assets, observing the limit of the contracted obligation. As under the
178
terms of CVM Decision 371/2000, the mentioned contracts are not included in the fair values
of the assets of the foundation, and because the sponsors are the guarantors and parties res-
ponsible for the formation and realization of that asset, the right was recognized as a deferral,
subject to future actuarial revaluations.
The amounts agreed between the parties are now amortized and aim to cover past shorta-
ges in assets stemming from actuarial valuations.
The surplus observed, besides the realization of the mentioned financial instruments, mi-
nimizes the risk of future unexpected actuarial liabilities. In accordance with the conditions
established by CVM Decision 371/2000, the Company did not recognize the positive result,
besides the amounts not included in the fair value of the assets.
The actuarial valuation is intrinsically uncertain and, therefore, is subject to changes du-
ring the annual actuarial review.
NOTE 29 - PROVISION FOR SHAREHOLDERS’ DEFICIT IN CONTROLLED COM-
PANIES
CVM Instruction 247/96 establishes that the recognition of losses with investments ap-
praised under the equity method in enterprises that need financial support of the investor
or to stop their businesses should be limited to the value of the investment recorded in the
controlling company. If applicable, shareholders’ equity deficit should be absorbed and recog-
nized by the investor and recorded under a specific liabilities caption, with a corresponding
entry to the expenses of the year.
The controlled companies CEPISA and CERON present shareholders’ equity deficit of
R$258,975 thousand and R$ 106,125 thousand, respectively, besides indications of the need
of financial support from ELETROBRÁS. The investor intends to keep its financial support to
the investees, so the Company keeps a provision of R$ 353,921 thousand for that shareholders’
equity deficit (R$ 875,777 thousand on December 31, 2007). See note 16.
Annual Report 2008
179
Annual Report 2008
NOTE 30 – PROVISION FOR CONTINGENCIES
At the closing date of the financial statements, the Company had the following provisions
for contingencies:
CURRENT
Labor
Tax
Civil
Other
(-) Escrow deposits
NONCURRENT
Labor
Tax
Civil
(-) Escrow deposits
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
-
-
-
-
-
-
-
-
-
-
-
-
507,195
181,853
778,660
186,594
(172,593)
1,481,709
88,574
-
1,328,244
(407,304)
17,072
461,831
-
60,147
1,328,244
1,899,297
(308,124)
(725,719)
1,009,514
1,037,192
1,695,556
1,009,514
1,037,192
3,177,265
418,775
32,770
713,349
118,241
(187,283)
1,095,852
306,641
129,361
1,884,573
(439,284)
1,881,291
2,977,143
There are several lawsuits, mainly labor and civil suits, at different trial stages against
ELETROBRÁS and its controlled companies. According to resolution 489/2005 of the Securities
and Exchange Commission (CVM), the Company’s management adopts the procedure of classi-
fying the lawsuits against the Company according to the risk of loss, based on the opinion of
its legal counselors, as follows:
•
•
•
For lawsuits for which an unfavorable outcome is considered as probable, provisions are
set up;
For lawsuits for which an unfavorable outcome is considered as possible, the related
information is disclosed in Notes to the financial statements, and
For lawsuits for which an unfavorable outcome is considered as remote, only the in-
formation deemed relevant by management is disclosed in the Notes to the financial
statements.
Accordingly, provisions for the contingencies mentioned above have been set up. Accor-
ding to the Company’s management and its legal counselors, those provisions, net of escrow
180
Annual Report 2008
deposits, are deemed sufficient to cover for losses from lawsuits of different nature. In the
year, they developed as follows:
R$ thousand
COMPANY
CONSOLIDATED
Balance as of December 31, 2006
1,158,355
Provisions set up
Reversal of provisions
Payments
Monetary restatement
Escrow deposits
Escrow deposits survey
Balance as of December 31, 2007
Provisions set up
Reversal of provisions
Payments
Monetary restatement
Escrow deposits
Escrow deposits survey
-
-
-
-
(121,163)
-
1,037,192
3,018,725
444,330
(185,758)
(140,787)
19,886
(185,074)
5,821
2,977,143
71,502
682,870
-
-
-
(311,265)
(42,240)
24,592
(99,180)
(168,997)
-
15,162
Balance as of December 31, 2008
1,009,514
3,177,265
1 - Lawsuits against the Company and its subsidiary companies rated as probable
losses:
1.1 - Lawsuits in controlled companies
CHESF:
a) ) The controlled company CHESF has filed a civil lawsuit claiming for partial annulment
of an amendment to the Xingó Hydroelectric Power Plant construction contract (Fator
K – Analytical price correction), signed with the Consortium formed by Companhia
Brasileira de Projetos e Obras - CBPO, Constran S.A.– Construções e Comércio e Mendes
Júnior Engenharia S.A. and reimbursement of approximately R$ 350 million, correspon-
ding to twice as much as the amounts paid.
181
Annual Report 2008
The suit was filed with the Federal Justice, but a decision from the Federal Regional
Court of the 5th Region determined that the suit be handled by the State of Pernambu-
co Justice. As of December 31, 2008, the proceeding had not been judged yet.
The suit filed by the company was considered groundless. The counterclaim filed by
the defendant was deemed groundful by the 12th Civil Court of the Judicial District of
Recife, and the decision was upheld by the 2nd Civil Chamber of the Federal Court of
Pernambuco. Chesf filed appeals for clarification of some of the counterclaim’s points
that were omitted from the decision of the 2nd Civil Chamber. These appeals were
judged and denied by the 2nd Civil Chamber. After that, Chesf’s management filed a
Special Appeal and an Extraordinary Appeal against the decision issued by the 2nd Civil
Chamber on the prior counterclaim. As of March 31, 2004, the special appeals filed
by Chesf were accepted by the Court of Justice of the State of Pernambuco, but the
extraordinary appeals also filed were not. Because of that, Chesf filed the proper bills
of review. As of June 30, 2005, the said appeals were sub judice at the Higher Courts.
After that date and as of March 31, 2006, the bills of review filed by Chesf with the
Federal Supreme Court (STF) were denied, and the Special Appeal filed by Chesf and
the Federal Government with the Superior Court of Justice (STJ) was accepted by the
Federal Public Prosecution Office, which issued its opinion requesting the annulment
of the suit due to the total inability of the State Justice to handle the case and the
reexamination of the merits of the case by proper court. As of September 30, 2006, the
proceeding awaited a final decision.
In November 1998, the defendants filed a request for temporary execution of the deci-
sion, amounting to R$245 million, but the procedures were suspended as determined
by STJ’s President (PET 1621). This request was object of a special appeal according to
specific court regulations filed by the Consortium and judged on June 24, 2006. The
unanimous decision was for the upholding of the decision previously granted by STJ’s
President. Accordingly, the possibility of the Consortium obtaining an interim relief
was eliminated.
Later, the defendants filed a settlement action in order to calculate the amount of the
decision then, in case all CHESF’s and Federal Government’s appeals were denied. As of
September 30, 2005, expert works were being conducted, as determined by the judge
ruling the process, in order to calculate the actual amount of the suit. After the first
report was presented by the expert, the parties requested clarifications to the report,
and the proceedings are again being examined by an expert.
Based on the opinion of its legal counselors and calculations that considered the
suspension of Fator K’s payments of installments and monetary restatement, the
company’s management set up a provision, recorded under Non-current Liabilities and
amounting to R$ 357,067 thousand as of December 31, 2008, to cover possible losses
182
Annual Report 2008
resulting from this subject. This provision corresponds to the partial disallowance of
Fator K from July 1990 to December 1993, pursuant to Law No. 8.030/1990, and total
suspension of Fator K’s payment from January 1994 to January 1996, according to the
company’s understanding.
As of December 31, 2007, the special appeal and the bill of review brought by the com-
pany awaited decision at the Superior Court of Justice and Federal Supreme Court, res-
pectively, and the court records had already been completed for the Reporting Judge’s
examination. The settlement action filed with the 12th Civil Court of the Judicial
District of Recife was under way at the state level and a hearing to discuss the expert
report was scheduled for February 19, 2008.
The judge recognized that the Federal Court is competent to decide on the settlement
action, considering that the Federal Government is a party to it. The Xingó Consortium
filed a motion for clarification of judgment, and the judge upheld his decision against
the appeal and sent the case records to the Federal Court. Dissatisfied with the deci-
sion, the Xingó Consortium filed a bill of review that, as of September 30, 2008, was
sub judice at the Court of Justice of the State of Pernambuco. As of December 31, 2008,
the proceeding had not been judged yet.
b) Suit for damages to be paid for the 14,400 hectares of land at Fazenda Aldeia filed at
Sento Sé District by the trustees of the estate of Aderson Moura de Souza and his wife
(Lawsuit 0085/1993). The lower court decision considered the request groundful and
sentenced Chesf to pay R$ 50 million, corresponding to the principal amount plus in-
terest and monetary restatement. As of December 31, 2008, Chesf filed an appeal with
Court of Justice of the State of Bahia.
CGTEE:
The civil contingencies of that subsidiary company refer mainly to disputes with suppliers,
whose probable loss according to the Company’s legal advisors corresponded to R$ 270 thou-
sand on December 31, 2008 (R$155 thousand on December 31, 2007).
Na Controlada Eletronorte:
As demandas cíveis de maior relevância são de caráter indenizatório por perdas financeiras,
em função de atrasos de pagamentos, e por desapropriações de áreas inundadas pelos reserva-
tórios de usinas hidrelétricas. O montante estimado de perda provável é de R$ 690.266 mil.
1.2 - Labor Lawsuits
1.2.1 - Company:
The Company has set up a provision of R$ 88,574 thousand to face possible losses with
labor contingencies.
183
Annual Report 2008
1.2.2 - Controlled companies
FURNAS:
a) Compensation of engineers
The Union of Engineers of the State of Rio de Janeiro filed labor actions claiming
the recovery of salary differences caused by a change in the base date of the raise in
the compensation of that company’s engineers. Currently, the proceedings are in the
process of being terminated. The estimated and booked amount corresponds to R$
83,436 thousand (R$71,500 thousand in 2007), of which R$ 16,747 thousand refers
to employees transferred to ELETRONUCLEAR due to the 1997 spin-off of the nuclear-
related activities.
b) Bonuses for hazardous working conditions
Various lawsuits were filed claiming hazardous working conditions extra pay, under
the assumption that the full percentage should be paid to all employees who provide
services in the electricity area and not proportionally. The estimated amount to cover
possible losses as of December 31, 2008 is R$ 62,597 thousand.
c) Retirement complementary benefit
An amount of R$ 58,808 thousand refers to supplementary retirement benefits for
equivalence with the earnings of active employees.
d) Sundry actions
As of December 31, 2008, a provision of R$ 121,982 thousand (R$ 61,602 thousand
on December 31, 2007) was kept to cover various civil and labor lawsuits filed against
the Company.
CHESF:
The contingencies in the labor area of CHESF are chiefly composed of actions referring
bonuses for hazardous working conditions, overtime, jointly contributions to the FACHESF
pension fund, and termination amounts arising from the delinquency of third party companies.
The main ones are commented below:
a) An action is in progress at the Regional Labor Court of the State of Bahia, filed by the
Union of Electric Sector Workers of Bahia, claiming the payment to the employees of
Gerência Regional de Paulo Afonso – GRP, city of Paulo Afonso – State of Bahia, the
salary difference caused by the application of Decree-Law no. 1971 and of the annual
increase on the value of bonuses for hazardous working conditions, estimated at R$
7,500 thousand. The Company filed a review appeal with the Superior Labor Court (TST)
that was denied. The process received a final and unappealable decision and CHESF
184
Annual Report 2008
was condemned to pay the amount. The execution has started and an amount of R$
3,700 thousand was paid to a significant part of the employees. A portion of R$ 3,800
thousand remains to be paid. As of December 31, 2008, the situation was unchanged,
and the company waited for the settlement.
b) An action was filed with the 8th Labor Court of Fortaleza - State of Ceará by the Union
of Electricity Sector Workers of the State of Ceará - SINDELETRO, aiming the refund
of losses incurred by the employees of Gerência Regional Norte – GRN (Ceará and Rio
Grande do Norte), stemming from the cancellation of transportation services, whose
proceeding has an estimated value of R$ 6,000 thousand. The request for the transpor-
tation to be resumed was granted in a partial execution and the Company is complying.
The Union asked for complementary transportation services and daily fine to be applied
against the Company. CHESF challenged the claim. The Labor Judge, after a hearing
held on August 23, 2005 for presentation of the arguments of CHESF, changed his pre-
vious understanding, determining the re-establishment of the transportation services
only to the extent previously provided. Still in the same decision, the parameters for
the settlement of the decision were established and the labor credit was reduced to R$
1,300 thousand. The Trial Labor Court of the city of Fortaleza is processing the execu-
tion, and rendered a final and unappealable decision. As of December 31, 2008, CHESF
still waited for the judgment of the bill of review filed by the plaintiff.
c) An action was filed with the 4th Labor Court of Recife - State of Pernambuco by the
Union of the Workers of Urban Industries of the State of Pernambuco (URBANITÁRIOS)
representing 460 employees who work in Recife, claiming the payment of hazardous
working conditions extra pay on all amounts of salary nature, what corresponds to R$
4,000 thousand. Due to the principle of lis alibi pendens, the Judge of the Trial Court
excluded from the proceeding 300 of the represented employees and judged the claim
groundless. The Union filed an ordinary appeal with the Labor Court of the 6th Region
that was granted. The proceeding was then sent for analysis of an expert. As of June
30, 2008, the expert work had been completed and the court determined the value of
the action as R$ 3,300 thousand. According to the calculations of the Company’s legal
counselors, the debt amounts to R$2,900 thousand and the difference will be challen-
ged through motion for stay of execution. As of December 31, 2008, the situation was
unchanged.
185
Annual Report 2008
1.3 - Lawsuits in controlled companies
FURNAS:
a) That controlled company, based on the latest decisions of the Brazilian Federal Revenue
Service, recognized a provision of R$ 83,424 thousand for PASEP/COFINS applicable on
the exclusion of the Global Reversal Reserve Quota (RGR) from the tax basis for the
periods between October 1995 and September 2000 and October 2005 to March 2007.
b) Assessment of deficiencies - FINSOCIAL, COFINS, and PASEP
On May 3, 2001, the controlled company FURNAS received a notice assessing deficien-
cies in FINSOCIAL, COFINS and PASEP, in the restated amount of R$ 1,098,900 thou-
sand (historic value - R$ 791,796) due to deductions from related tax bases, especially
of the revenues from the pass-on and transmission of ITAIPU’s electricity for a ten-year
period. These deficiencies are in addition to others assessed in 1999 for an inspection
period of five fiscal years, corresponding to R$ 615,089 thousand, which were included
in a tax debt refinancing program (REFIS) in March 2000 and transferred in July 2003
to the Special Tax debt refinancing program (PAES).
According to bill No. 8 of Superior Court Feeral (STF), of June 12, 2008, that limited in
5 (five) years the term of loss of procedural right of these contributions, the amount of
the assessment was reduced from R$ 1,098,900 thousand to R$ 228,592 thousand.
The Company, based on the latest decisions of the Federal Revenue Service, recognized
a provision of tax contingencies of R$ 83,424 thousand for PASEP/COFINS applicable
on the exclusion of the Global Reversal Reserve Quota (RGR) from the tax basis for the
periods between October 1995 and September 2000 and October 2005 to March 2007.
The R$145.168 thousand difference refers to other exclusions from the mentioned tax
basis, not judged yet, where there are chances of a favorable result to FURNAS, accor-
ding to the understanding of its legal area.
ELETRONORTE:
a)That controlled company is involved in some actions involving ICMS (State VAT) and has
recognized a provision of R$ 53,033 thousand to cover possible losses.
CHESF:
a) That subsidiary is involved in lawsuits for cancellation of assessments of deficiency and
request of refund of credits (PIS/PASEP, COFINS), among others. The company has set
up a provision of R$ 8,770 thousand (R$ 8,321 thousand as of December 31, 2007).
186
Annual Report 2008
2 - Lawsuits against the Company and its subsidiary companies rated as possible
losses:
2.1 - Civil lawsuits
2.1.1 - Company:
The Company’s provision for civil contingencies, in the amount of R$ 1,328,244 thousand (R$
1,328,244 thousand on December 31, 2007), refers to Compulsory Loan-related lawsuits, taken
on behalf of ELETROBRÁS starting in 1978, with monetary restatement criteria different from
those established in the specific Law.
Those actions should not be confused with those filed claiming the redemption of the curren-
tly unenforceable Bearer Bonds issued in association with the compulsory loan.
The proceedings accrued for challenged the calculation system of monetary restatement de-
termined in the law that governs the compulsory loan, used for adjustment of the credits taken
starting in 1978. Those credits have been fully paid by ELETROBRÁS through conversions into
shares as defined in the 72nd, 82nd, and 142nd extraordinary meetings of ELETROBRÁS.
There are 3,578 lawsuits under way at different stages, aiming at recognition of the right to
receive full monetary restatement on the amounts paid as compulsory loan. Supported by their
legal counselors’ opinion, ELETROBRÁS management estimated at eight to ten years, the average
term for a final lawsuit settlement.
Under this criterion, ELETROBRÁS management, based on its legal counselors’ opinion, eva-
luates that the risk of loss on the Compulsory Loan-related lawsuits as possible.
However, due to the substantial amounts involved, management, on a conservative basis
and taking into account lower-court unfavorable decisions and the lack of judgment by the
Higher Court of Justice on the merits of the cause, adopts the practice of setting up a provision
for contingencies, which was made in prior years, to cover possible losses on unfavorable legal
decisions.
In this scenario, therefore, the Company’s management, due to the importance of the issue,
decided to carefully consider matters affecting the company’s assets, in case something changes
the course of the trials. Through this, the Company fulfills its duty to best protect the users of
the Financial Statements, mainly regarding the assessment of its liabilities, and, consequently,
of its stockholders’ equity, trying to avoid extremely optimist analyses in making decisions based
on account information.
187
Annual Report 2008
Thus, the accumulated amount provisioned, corresponding to R$ 1,328,244 thousand, despi-
te the classification of possible risk, is considered sufficient by the Company’s management and
it is in conformity with the different stages of the lawsuits and their natures. It is not possible,
at the current stage and circumstances, to get to a conclusion about the outcome of the proce-
edings that may reach an approximate amount of R $ 3,350,000 thousand.
2.1.2 - Controlled companies
CHESF:
a) Two indemnity actions filed against CHESF by the Consortium formed by CBPO/CONS-
TRAN/Mendes Júnior claiming the controlled company’s payment of an additional fi-
nancial compensation, due to the delayed payment of invoices under the Xingó Hydro-
electric Power Plant construction contract. One of these actions, filed in June 1999,
referred to invoices issued as from April 1990 and the other, filed in May 2000, referred
to invoices issued until then. The plaintiffs’ general claims under these actions were
restricted to the existence of an alleged right to financial compensation, the determi-
nation of the respective amounts being postponed to the end of the action.
The Company challenged the actions and requested the Federal Revenue Service to be
included in the action and the proceeding to be transferred to one of the courts of the
Federal Justice in Pernambuco. The Consortium filed a motion addressing the request
of the inclusion of the Brazilian Federal Government in the proceeding.
After presentation of the expert’s work and additional explanations, a hearing was held
in August 2005. It was determined the presentation of the closing arguments until
October 17, 2005. Currently, the proceeding was sent to the judge under advisement
and there will probably be a pretrial order for rendering of a decision. As of December
31, 2008, the situation remained unchanged.
b) A public civil action filed against the Company by Associação Comunitária do Povoado
do Cabeço e Adjacências (Community Association of the Town of Cabeço and Surroun-
ding Areas), in the State of Sergipe, corresponding to R$ 100,000 thousand, with the
2nd Federal Court of Sergipe. It aims a financial compensation associated with alleged
environmental damages caused to the fishermen of Cabeço, resulting from the cons-
truction of the Xingó Hydroelectric Power Plant.
The action was filed with a federal court on June 27, 2002, and was challenged within the
legally established period. After a series of proceeding occurrences that have not affected
the claim, on August 31, 2005, a judge determined the inclusion of the Brazilian Federal Go-
vernment, IBAMA (Brazilian Institute of the Environment), IMA-AL (Environment Institute
of the State of Alagoas), CRA-BA (Regional Administration Council of the State of Bahia),
and ADEMA-SE (State Environment Administration of the State of Sergipe) in lawsuit, orde-
ring the delivery and service of the summons to those entities.
188
Annual Report 2008
As of September 30, 2005, the company was waiting for the service of process to take
place. On September 30, 2006, the proceeding was sent to the Judge under advise-
ment, after the entrance in the docket of CHESF’s new defenders. On December 31,
2006, the proceeding was suspended by a decision of the Judge, awaiting judgment of
the interlocutory appeal filed by the author of the lawsuit with Federal Court of Appeals
of the 5th Region. That has not been judged yet.
The co-parties of CHESF (the Brazilian Federal Government, IBAMA, IMA-AL, CRA-BA
and ADEMA-SE) have already been summoned. On September 12, 2007, the judge is-
sued a pretrial order with the following contents: “Await information on the final
and unappealable decision of the appeal, which should be communicated to CHESF.”
Considering that the interlocutory appeal CHESF filed was refused, that company filed
a motion for resettlement against that decision, which, as of March 31, 2008 had not
been judged yet.
On June 13, 2008, a pretrial order of the judge determined the summoning of the Bra-
zilian Federal Government and of IBAMA, as well as summoning the author of the suit
to discuss the terms of the action. As of September 30, 2006, the case records were
with IBAMA. As of December 31, 2008, the subsidiary was waiting for the conciliation
hearing, set up for February 19, 2009. As the hearing did not that place on that date,
the judge ordered new steps for the continuation of the proceeding.
c) A public civil action was also filed against controlled company CHESF, in the district of
Brejo Grande/SE, involving R$100 million, with the same claims of the action referred
to above, but abandoned by the plaintiff in February 2005. The latest proceeding was
performed in November 2007, when the judge determined that the Public Prosecution
Office presented its arguments regarding the civil action. As of March 31, 2008, the
action remained stalled and with no position from the Public Prosecution Office. As of
June 30, 2008, the judge from Brejo Grande District issued a decision recognizing the
inability of the State Justice to handle the case and determining that the case records
are sent to the Federal Justice. As of September 30, 2008, these case records were with
IBAMA. On December 31, 2008, IBAMA had not returned the records yet.
According to the opinion of Company’s legal counselors, the risk of an unfavorable outco-
me for those actions (items b and c) is possible, but the loss amount is not known.
CGTEE:
CEEE-D filed a lawsuit claiming the amounts related to the transference action of CGTEE by
CEEE to ELETROBRÁS. The value of the action amounts to R$ 3,650 thousand, and according to
the analysis of the legal advisors, it is rated as a possible loss for the Company.
189
Annual Report 2008
3 - Lawsuits against the Company and its controlled companies rated as remote
losses:
3.1 - Civil lawsuits
3.1.1 - Company:
ELETROBRÁS has been named as a defendant in an action filed by Brazilian Association
of the Consumers of water and Electric Power – ASSOBRAEE with the 17th Federal Court in
Brasília. The plaintiff claim the use of the market value of ELETROBRÁS’ shares as the price of
the stocks issued for paying compulsory loan credits, instead of the book value currently set
as parameter for the issue. The amount claimed totals R$2,397,003 thousand, and according
to legal advisors, the chance of unfavorable outcome is remote.
ELETROBRÁS is also a party to other lawsuits whose purpose is the redemption of the Be-
arer Bonds issued by the Company in connection with the compulsory loan collected between
1964 and 1976. Pursuant to the provisions of article 4, paragraph 11 of Law No. 4.156/62 and
article 1 of Decree No. 20.910/32, these obligations are unenforceable.
The Company’s management, supported by its legal counselors, considers that the possi-
bility of an unfavorable outcome for ELETROBRÁS of these ongoing lawsuits is remote, con-
sidering that case law on the issue is unanimous on the statute of limitations period for the
right to claim redemption of the obligations issued for the compulsory loan and the unenfor-
ceability of these notes (See note 22).
3.1.2 - Controlled companies
CHESF:
Despite considered by CHESF’s legal counselors as a remote risk of loss, there is a collection
action filed by the company Mendes Júnior, engaged for the UHE Itaparica construction, clai-
ming for indemnification of alleged financial losses caused by the delayed payment of invoices
on the part of the controlled company.
Said collection lawsuit is based on the Declaratory Action found valid for the purposes
of declaring the existence of a Mendes Júnior’s credit against CHESF, thus ensuring financial
refunding.
After the decision of the Superior Court of Justice to not recognize the special appeal filed
by Construtora Mendes Júnior, and confirm the decision of the 2nd Civil Chamber of the Federal
Court of Pernambuco, which annulled the decision and determined the remand of the case
records to one of Pernambuco’s lower courts, the lawsuit was sent to the 12th Federal Court
under number 2000.83.00.014864-7, for a new expert work and render of a new decision.
The expert work report was presented and in reply to CHESF’S question stated “based on
an analysis of Mendes Junior’s accounting records, it is impossible to confirm that in the pe-
riods of delayed invoice payment, Mendes Junior actually raised funds in the money market,
190
Annual Report 2008
specifically for funding the Itaparica construction works.” This answer was confirmed by the
analysis made by CHESF’S Technical Assistant, which included a detailed exam of Mendes
Junior’s financial statements. Based on these results, CHESF requested the suit to be conside-
red totally groundless.
The Federal Public Prosecution Office presented its request to nullify the action. And, on
the merits of the case, requested the suit to be considered groundless.
The suit was considered valid in part, according to a decision issued on March 8, 2008.
Mendes Júnior filed an appeal for clarification of the sentence, requesting the total appro-
val of the report prepared by the Official Expert. The Federal Public Prosecution Office filed a
request for the judgment to be considered entirely groundless.
The appeals filed by Mendes Júnior and Federal Public Prosecution Office were rejected by
The Judge of the 12th Federal Court.
CHESF and the Federal Government filed appeals for clarification, both granted by the
Judge, whose sentence clarified some of the prior sentence’s points on the assessment of a
possible debt owed by CHESF to Mendes Júnior. This sentence clarified the point that determi-
nes that, on the assessment of a possible debt owed by CHESF to Mendes Júnior, any and all
payments of the principal, and any and all financial compensations paid by CHESF, according
to the contract, must be discounted.
CHESF appealed the decision requesting the suit to be considered entirely groundless,
since this collection suit required Mendes Júnior to prove that it raised funds specifically for
funding the Itaparica construction work, because of the delayed payment of some invoices on
the part of CHESF, and in amounts above the late payment fines paid by CHESF, in order to be
entitled to any financial compensation, according to the Declaratory Action previously men-
tioned. In December 2008, the Brazilian Federal Government, CHESF and Mendes Júnior, had
already filed appeals, and the period established for the Public Prosecution Office to present
its arguments is in progress.
Accordingly, considering the elements already included in the suit, we see that Mendes
Júnior has not taken any loan to specifically finance Itaparica’s construction works (or at
least, not in the amounts stated). Also considering the calculations already made by CHESF,
and that, according to the court decision, all the benefits granted to Mendes Júnior during the
execution of the contract must be compensated; CHESF’S legal counsel supports the Company’s
management position and considers the probability of unfavorable outcome remote.
191
Annual Report 2008
NOTE 31 - OBLIGATIONS ASSUMED FOR THE DECOMMISSIONING OF ASSETS
A Companhia reconhece obrigações para descomissionamento de usinas termonucleares,
quThe Company recognizes obligations assumed for the decommissioning of thermonuclear
plants. This consists of a program of activities demanded by the National Nuclear Safety Au-
thority (Brazilian Commission of Nuclear Energy - CNEN) that allows nuclear facilities to be
safely dismantled, with minimum impact to the environment. In the case of Brazilian thermo-
nuclear plants (Angra 1 and Angra 2), the option chosen was the decommissioning program
known worldwide as “SAFSTOR,” which comprises the total dismantlement of the plant after a
period of dormancy of 15 years.
The calculation of the liabilities arising from the decommissioning program is based on
prevailing Brazilian and international laws and regulations, the technology currently available
to carry out such activities, and the costs specific to the place where the plants are located.
According to Law No. 10.308/2001, Eletronuclear is legally responsible for the initial de-
posits of waste arising from the decommissioning of Angra I and Angra II and, accordingly,
it bears the costs of this obligation. Under the provisions of Law No. 10.308/2001, CNEN is
responsible for and bears the costs of implementing the intermediate and final deposits of wa-
ste. Therefore, these costs are not included in the calculation of the liabilities resulting from
the decommissioning of thermonuclear plants, though the costs for the storage of the waste
are. Article 18 of the mentioned Law establishes that intermediate and final waste storage
services will have their respective costs reimbursed to CNEN by the depositors, according to a
table approved by CNEN Advisory Commission to be in force starting on the first business day
following the publication on the federal official gazette.
With Angra II starting operations in 2000, new studies on decommissioning costs were
conducted on the basis of estimates applicable to a set of 17 US plants and 10 European, Ca-
nadian and Japanese plants which are at different decommissioning stages, as well as criteria
set by the US NRC – Nuclear Regulatory Commission. These criteria were used in studies of
plants similar to the Brazilian ones, including a specific study conducted at the Krisko plant,
which is considered as Angra I’s twin sister.
Angra I’s and Angra II’s decommissioning cost is estimated at US$197,816 thousand and
US$240,000 thousand, and the end of the plants’ useful lives forecast for December 2014 and
August 2030, respectively.
In 2007, the Company’s management reviewed and adjusted the values, besides defi-
ning parameters and regulations for setting up the necessary financial reserves to cover the
plant decommissioning costs. Therefore, the adjusted costs are US$307,000 thousand and
US$426,000 thousand for Angra I and Angra II, respectively. The useful economic live of the
plants was set to be 40 years. As a result of that revaluation, total obligation changed from
US$437,816 thousand to US$733,000 thousand.
As of December 31, 2008, when discounted to present value - in compliance with CVM
Instruction 469/2009 – these amounts correspond to US$ 82,372 thousand (Angra I) and
192
Annual Report 2008
US$33,520 thousand (Angra II). The total balance of liabilities corresponding to the obliga-
tions for deactivation of the nuclear plants Angra I and II is R$ 266,168 thousand (R$ 451,017
thousand on December 31, 2007). A discount rate adequate to the business risk was used to
calculate the present value of decommissioning obligations.
The amounts recorded as liabilities incurred with decommissioning thermonuclear plants
are estimated and will be revised through the economic lives of the plants, considering tech-
nological advances with the purpose of allocating the costs to be incurred with their deacti-
vation to the respective accrual period.
No specific legislation tackling the decommissioning of thermonuclear plants is currently
in effect in Brazil and, accordingly, the conditions for the decommissioning, the procedures
to be implemented, amounts to be spent and the measures to be taken if these amounts are
insufficient or in excess, are not established.
ELETRONUCLEAR manages low, medium, and high radioactivity waste. Low activity waste
comprises disposable materials used in the operation and maintenance of the nuclear plants.
Medium activity waste is the water purification resin and filters. High activity waste is the fuel
used. High activity waste is the fuel used.
Accordingly, ELETRONUCLEAR has already built a Waste Management Center - CGR for the
storage of low and medium activity wastes, located in Angra dos Reis, Rio de Janeiro State.
For high activity waste, ELETRONUCLEAR operates 2 (two) initial deposits (spent fuel pool)
inside the respective Angra I and Angra II plants. There is also the project of another stora-
ge pool for spent fuel elements, located outside the plants, which will increase the storage
capacity of the Nuclear Center and allow it to store all the fuel used by Angra 1 and Angra 2
reactors, throughout the useful lives of those units.
Decommissioning costs include services referring to the removal, transportation and final
disposal of low and medium activity waste generated during the decommissioning program
They also include the removal and transportation of the used fuel elements to be stored where
established by CNEN. These costs, however, do not include the services of subsequent inter-
mediate and final storage of those fuel elements.
These latter costs are not considered because there are no procedures, technical regula-
tions, or specific legislation for the long-term storage of used fuel elements. The used fuel
may be recycled in the future through reprocessing techniques, as currently made in countries
such as France and Japan. That might generate enough funds to pay for the costs of the final
storage of the resulting high activity waste.
Given the specific characteristics of a thermonuclear plant operation and maintenance,
whenever the estimated decommissioning costs change, due to new studies applying more
advanced technology, the decommissioning quotas must be changed accordingly, so the liabi-
lities can be adjusted to the new reality..
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Annual Report 2008
NOTE 32 - SHAREHOLDERS’ EQUITY
I - Capital Stock
The Company’s capital stock amounts to R$ 26,156,567 thousand (R$24,235,829 thousand
on December 31, 2007), and its shares have no nominal value. Preferred shares are non-voting
and non-convertible to common, but are entitled to liquidation preference and dividend distri-
bution at the annual rates of 8% for class “A” shares (subscribed prior to June 23, 1969) and
6% for class “B” shares (subscribed as from June 24, 1969), calculated ratably to the capital
corresponding to each class of shares.
Capital stock comprises 1,132,357,090 shares, thus distributed by major stockholders and
types of shares:
NUMBER OF SHARES
SHAREHOLDER
NUMBER
%
Class A
Class B
%
NUMBER
%
COMMON
PREFERRED
TOTAL CAPITAL
Brazilian Federal
Government
488,656,241
53.99
BNDESPAR
133,757,950
14.78
FND (National
Development Fund)
FGP (Fund Guaranteeing
Public Private
Partnerships)
45,621,589
5.04
40,000,000
4.42
-
-
-
-
35,191,714
15.49
523,847,955
46.26
-
-
-
-
-
-
133,757,950
11.81
45,621,589
4.03
40,000,000
3.53
Other
196,987,747
21.77
146,920 191,994,929
84.51
389,129,596
34.37
905,023,527 100.00
146,9200 227,186,643 100.00
1,132,357,090
100.00
Of the total 389,129,596 shares held by minority stockholders, 239,401,535 shares or
61.52% are owned by non-resident investors, 132,867,994 of which are common shares, 27
preferred class “A” shares, and 106,533,514 are preferred class “B” shares.
Of the shares owned by investors domiciled abroad, 69,298,867 common shares and
33,438,069 preferred class “B” shares are under custody, to support the ADR – American De-
positary Receipts - level I Program.
As of December 31, 2008, the book value per share was R$ 75.61 (R$ 70.79 on December
31, 2007).
II - Converting Compulsory Loans into Shares
On April 30, 2008, the Company’s 151st Extraordinary General Meeting decided on the
fourth conversion of the total credits as of December 31, 2007 into class B registered preferred
194
Annual Report 2008
shares of ELETROBRAS’ capital stock. These credits, corresponding to R$202,375 thousand,
were recognized after the third conversion on April 28, 2005.
Shares will be issued at a price based on the book value of ELETROBRAS’ shares as of De-
cember 31, 2007 of R$ 70.79 pursuant to article 4 of Law No. 7.181/83.Residual values not re-
sulting in whole shares will be paid in kind, as establishes article 10 of Decree No. 81.668/78,
plus the amounts received as a result of the exercise of the preemptive subscription right by
other shareholders, as established by CVM’s guidelines.
The period for exercising the preemptive subscription right by the other shareholders will
be set in accordance with article 171, paragraph 2 of Law No. 6.404/76, as well as the period
for the delivery of the shares arising from the conversion. Those periods were 30 and 60 days,
respectively, counted as of the Extraordinary General Meeting date. In addition, article 6 of
ELETROBRÁS’ by-laws, which addresses the composition of the Capital Stock and Shares, was
amended.
III - Capital Reserves
Compensation for insufficient remuneration - CRC
Goodwill on issuance of shares
Special - Decree Law 54.936/1964
Monetary restatement of beginning balance - 1978
Monetary restatement of compulsory loan - 1987
Donations and grants - FINOR, FINAM and others
R$ thousand
COMPANY AND CONSOLIDATED
2008
2007
18,961,102
3,384,310
387,419
309,655
2,708,432
297,424
26,048,342
18,961,102
3,243,272
387,419
309,655
2,708,432
297,424
25,907,304
The CRC capital reserve (Compensation account - CRC) corresponds to ELETROBRÁS’ inte-
rest in any shortfalls in the remuneration paid to its controlled companies under the former
guaranteed return system prevailing in the Electricity Sector up to 1993, accounted for upon
the settlement of obligations by the Federal Treasury.
IV - Income Reserves
Under the Company’s by-laws, 50% of net income should be appropriated to the invest-
ment reserve and 1% to the reserve for studies and projects. Its recognition is limited to 75%
and 2% of capital stock, respectively:
195
Legal (article 193 - Law 6.404/76)
Statutory (article 194 - Law 6.404/76):
Studies and projects
Investments
Other
Retained earnings (article 196 - Law 6.404/76)
Special (article 202 - Law 6.404/76):
Undistributed dividends
R$ thousand
COMPANY AND CONSOLIDATED
2008
2007
2,037,863
1,731,038
61,365
16,977,346
-
487,476
9,336,858
28,900,908
255,899
15,432,771
11,080
68,748
8,300,832
25,800,368
On December 31, 2008, the adjusted balance of the special undistributed dividend reserve
(art 202. Law 6.404/76) had the following holders of common shares.
RESERVE
NUMBER
%
COMMON SHARES
Brazilian Federal Govern-
ment
BNDESPAR
FND
FGP
Minority shareholders
TOTAL
488,656,241
133,757,950
45,621,589
40,000,000
196,987,747
905,023,527
53.99
14.78
5.04
4.42
21.77
100.00
RESERVE
R$ mil
5,040,970
1,379,988
470,578
412,689
2,032,633
9,336,858
Annual Report 2008
196
Annual Report 2008
V - Revaluation Reserve
These comprise the reserves, accounted for on the equity method, of the relevant affiliates
CELPA and CEMAT, which revalued its property, plant and equipment items.
VI - Advances for future increase in capital
The advances of funds received from the controlling shareholder are destined exclusively
to capitalization and are classified under “Shareholders’ Equity.” Following Decree 2.673/98,
they are adjusted according to the SELIC (Special System for Settlement and Custody) rate:
Acquisition of interests in CEEE
Acquisition of interests in CGTEE
Banabuí–Fortaleza transmission line
XINGÓ Hydroelectric Power Plant
Transmission lines in the State of Bahia
Federal Electrification Fund - Law 5.073/66
NOTE 33 - OPERATIONS WITH ELECTRICITY
Power sold to final consumers
Power sold to concessionaries
Transmission
Commercialization at CCEE - short-term energy
Transference of Energy from ITAIPU
Regulatory Assets - Commercialization of ITAIPU’s energy
R$ thousand
COMPANY AND CONSOLIDATED
2008
1,959,715
1,882,864
64,868
182,257
28,530
169,119
2007
1,742,265
1,673,938
57,670
162,034
25,365
150,353
4,287,353
3,811,625
R$ thousand
CONSOLIDATED
2008
2007
5,695,688
9,372,059
4,334,236
2,604,620
5,777,524
3,666,637
5,884,191
8,385,288
3,403,342
1,066,798
6,273,929
590,024
31,450,764
25,603,572
197
Annual Report 2008
NOTE 34 - DEDUCTIONS TO THE OPERATIONS WITH ELECTRICITY
Global Reversion Reserve Quota – RGR
Fuel Consumption Account – CCC
Energy Development Account – CDE
Alternative Electricity Sources Incentive Program - PROINFA
Other
ICMS (State VAT)
R$ thousand
CONSOLIDATED
2008
2007
536,711
332,979
66,304
73,936
181,743
1,191,673
984,608
2,176,281
471,069
452,152
70,871
57,975
183,924
1,235,991
882,750
2,118,741
NOTE 35 - OPERATING REVENUES - OWNERSHIP INTEREST
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
Investments in controlled companies
Equity in earnings (loss)
(236,157)
1,149,525
Yield on equity capital - ITAIPU
36,157
39,325
(200,000)
1,188,850
Investment in affiliated companies
Equity in earnings
Interest on own capital
Other investments
Interest on own capital
Dividends
464,267
96,341
560,608
14,171
88,643
Return on investments in partnerships
(80,623)
411,725
109,936
521,661
16,942
88,004
67,832
22,191
172,778
382,799
1,883,289
-
36,157
36,157
464,267
96,341
560,608
14,171
88,643
(34,046)
68,768
665,533
-
39,325
39,325
411,725
109,936
521,661
16,942
88,004
87,360
192,306
753,292
198
NOTE 36 - PERSONNEL, MATERIAL, AND SERVICES
Personnel
Material
Services
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
220,941
2,899
54,613
278,453
260,425
3,670,434
3,233,364
2,284
55,661
318,370
260,854
1,508,354
5,439,642
234,683
1,450,491
4,918,538
NOTE 37 - ENERGY PURCHASED FOR RESALE AND USE OF THE ELECTRIC
GRID
Electricity network use
Supply of electricity
Energy from ITAIPU
Commercialization at CCEE - short-term energy
Other
R$ thousand
COMPANY
2008
2007
1,101,220
5,534,238
2,047,016
1,212,066
38,994
9,933,534
976,647
1,967,566
3,320,526
1,108,673
23,866
7,397,278
Annual Report 2008
199
Annual Report 2008
NOTE 38 - OPERATING PROVISIONS
Contingencies
Allowance for doubtful accounts - Consumers and
Resellers
Allowance for doubtful accounts - RTE
Allowance for doubtful accounts - CCEE
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
71,501
-
-
-
-
-
-
-
345,273
173,630
40,345
272,435
(242,734)
68,543
-
293,560
Allowance for Doubtful Accounts - loans and financing
37,045
29,001
37,045
29,001
Allowance for Doubtful Accounts - ICMS Credits
-
-
468,405
127,710
Allowance for Doubtful Accounts – securities
12,981
(9,007)
12,981
(9,007)
Recoverable value of assets (Impairment)
-
-
770,231
Losses in the realization - advances for future increase
in capital
(7,535)
42,394
Shareholders’ deficit in controlled companies
135,652
532,781
-
-
-
-
-
Other
54,350
(8,686)
112,545
149,250
303,994
586,483
1,544,091
1,105,122
NOTE 39 – FINANCIAL INCOME (ExPENSES)
R$ thousand
COMPANY
CONSOLIDATED
2008
2007
2008
2007
Financial income (expenses)
Revenues from interest, commission and fees
3,568,780
4,188,934
1,199,439
1,958,944
Debt charges
(479,655)
(447,237)
(1,442,159)
(1,433,014)
Charges on shareholders’ funds
(1,576,023)
(1,353,792)
(1,599,504)
(1,370,808)
Revenue from financial investments
Other revenue (expenses)
Monetary and exchange restatements
959,344
30,068
537,453
144,973
1,160,571
868,132
113,007
1,333,660
2,502,514
3,070,331
(568,646)
1,356,914
Monetary restatements, net
997,786
528,082
320,223
42,927
Exchange restatement, net
4,297,123
(3,000,510)
3,632,191
(2,608,504)
5,294,909
(2,472,428)
3,952,414
(2,565,577)
7,797,423
597,903
3,383,768
(1,208,663)
200
Annual Report 2008
NOTE 40 - PROFIT SHARING
ELETROBRÁS, and its controlled companies, adopt a profit sharing program applicable to
all employees. It has as objective to promote quality and better productivity levels and global
results of the Company.
The program is based on collective bargaining agreements with employees and unions,
under the terms of the prevailing federal law, and is carried out through previous negotiation
of goals and commitments.
In the year 2008, ELETROBRÁS accrued for an amount of R$ 23,000 thousand (R$ 18,000
thousand on December 31, 2007) and R$ 176,817 thousand in the consolidated (R$ 159.926
thousand on December 31, 2007), corresponding to the profiting sharing of employees and
management, observing Resolution 10, of May 30, 1995, of the Council for the Coordination
and Control of Government Controlled companies - CCE.
The payment of profit sharing will be discussed during an ordinary general meeting of
shareholders, who will analyze the Financial Statements.
NOTE 41 - COMPENSATION OF EMPLOYEES AND MANAGEMENT
The lowest and highest compensation paid to employees, taking as basis the month of De-
cember 2008, were R$ 1,719.03 and R$ 24,122.80 (including transfer additional) respectively,
in accordance with the salary policy of ELETROBRÁS. The highest fees attributed to a manager,
taking as basis the month of December 2008, corresponded to R$28,186.00.
The total compensation of the Company’s management in the year 2008 was R$ 3,592
thousand, of which R$ 551 thousand for the Management Board and R$ 3,041 thousand for
the Board of Directors.
NOTE 42 - DISCRETIONARY RESIGNATION PROGRAM
ELETROBRÁS implanted a Discretionary Resignation Program (PDVE), aiming a restructu-
ring of its staff, open to all employees that fulfill the following conditions:
a) Participants of the Defined Benefit Plan of Fundação Eletrobrás de Seguridade Social
(ELETROS) who were retired by the Federal Social Security Institute (INSS) and meet
the requirements to obtain the complementary retirement benefit within twenty-four
months after joining the PDVE;
b) Participants of the Defined Contribution Plan of ELETROS who satisfy the requirements
to obtain the complementary retirement benefit within twenty-four months after joi-
ning the PDVE; and
c) Non-participants of ELETROS - who were retired by the Federal Social Security Institute
(INSS) or that are in conditions to obtain retirement within twenty-four months after
joining the PDVE, even if in a proportional manner, under the General Social Security
Regime.
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Annual Report 2008
After the end of the employment period with ELETROBRÁS, the Company no longer is res-
ponsible for any contributions to the Public Social Security or private pension plan.
The incentive to the employee in relation to PDVE is made through payment of a com-
plementary compensation, per year of service, plus the termination amounts payable for an
unjustified dismissal, in accordance with the following criteria:
a) Fifty percent of a monthly compensation per complete year of work, limited to twenty-
four years and to the amount corresponding to twelve times the highest salary of the
Company;
b) Medical assistance during twelve months counted upon the dismissal date.
The period to join PDVE ended on December 31, 2007, with the inclusion of 311 employe-
es. Sixty-eight employees were dismissed until December 2008. The dismissal of 243 employe-
es is projected for 2009.
As of December 31, 2008, the Company had accrued for a provision of R$ 67,835 thousand,
recognized under the caption “Estimated Obligations” to cover expenses with the implanta-
tion of PDVE, to be realized until December 2009, as the dismissals take place.
NOTE 43 - FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
I - Management of funds
Most of the financial investments of ELETROBRÁS are long-term loans and financing, in
addition to the interests held in public service concessionaires, detailed in notes 9 and 16 and
in attachments II and III.
II - Financial instruments
a) Cash and cash equivalents: the market values of those assets correspond to their car-
rying amounts.
b) Marketable securities: classified as held to maturity are recognized at acquisition cost,
plus interest and monetary variation with effects to the income. Such instruments are
adjusted to their probable realizable value, where applicable.
c) Consumers and resellers: receivables form consumers and resellers are classified as held
to maturity and are presented at their probable realizable values.
d) Rescheduled receivables: are classified as held to maturity and are presented at their
probable realizable values.
e) Loans and financing granted: loans and financing granted are linked with financing in
the domestic electric sector. They are restated according to an average rate of 9.73%
p.a. (8.99 % p.a. on December 31, 2007).
202
Annual Report 2008
Financing is restricted to electricity public concessionaires and, therefore, defines the
market rate (or cost of opportunity of the Company’s capital), taking into account the
risk premium compatible with the activities of the sector. In case it is not possible to
find other alternatives that not the own electric sector, the fair value of those loans
corresponds to their book value.
At the end of the year, the Company had 784 agreements covering loans and financing
granted, corresponding to R$ 42,234,271 thousand (R$ 36,522,430 thousand on De-
cember 31, 2007), as follows:
Currency
Corresponding value in
US$ thousand
%
R$ thousand
thousand
IGP-M
Real
Yen
Euro
Total
8.637.294
4.327.464
4.736.721
261.955
108.569
47.79
23.95
26.21
1.45
0.60
20,185,355
10,113,284
11,069,717
612,189
253,726
18.072.002
100.00
42,234,271
f) Loans and financing obtained:
Loans and financing obtained with financial institutions are recorded in long-term
accounts, in particular those obtained overseas and Federal Government Funds, such
as the Global Reversion Reserve Quota (RGR). The market values of those loans and
financing correspond to their book values.
The funds raised are composed of contracted financing with international multilateral
agencies - IBD, IBRD, ADC - and it is not practicable to discount them at a rate diffe-
rent from the one established in the Brazilian debt agreement. Other loans are obtained
at international rates, what makes book value approximate fair value.
ELETROBRÁS ended the year 2008 with 13 contracts recorded in liabilities, among
which loans, financing, and bonuses, that total R$ 4,158,111 thousand (R$ 1,716,302
thousand on December 31, 2007), as demonstrated below:
203
Annual Report 2008
R$ Corresponding
value in
US$ thousand
3,361,578
542,348
254,186
4,158,111
Currency
Corresponding value in
US$ thousand
US dollar
Yen
EURO
Total
%
80.84
13.04
6.12
1.438.416
232.070
108.766
1.779.252
100.00
g) The Compulsory Loan, abolished by Law 7,181 of December 20, 1993, had December
31, 1993 as limit period for payment. Now ELETROBRÁS manages the residual value of
the compulsory loan collected, adjusting it according to the IPCA-E index and adding
to it interest of 6% p.a., with a defined redemption period. The market values of those
loans and financing correspond to their book values.
h) Derivatives
1 - Policy
The Company has a mismatch between its foreign currency receivables and payables
mainly arising from the receivables of its jointly-owned controlled company ITAIPU
Binacional. These refer to its financing contracts and low indebtedness, which make
the company subject to impacts on its assets and results, due to exchange rate fluctu-
ations, particularly of the US dollar.
As from 2008, Eletrobrás started to enter into derivative agreements with the purpose
of managing its exposure to exchange rate fluctuations.
The Company’s policy on derivatives does not establish the use of derivatives with the
purpose of credit granting, fund raising, or any kind of financial assistance. Its sole
purpose is hedging Company’s assets from exchange rate variations.
2 - Objectives and strategies
Within the extent of its hedge policy, in 2008 the Company executed operations that
amounted to US$ 280,000 thousand to protect the receivables maturing until the end
of that year. The Company made use of non-deliverable forwards based on the US dollar,
matching the maturities of the contracts with the due dates of service receivables of the
jointly-owned controlled company Itaipu Binacional.
As the Company had not previously used this kind of financial instrument, it created
internal controls to monitor the transactions, record positions and mark the portfolio to
the market.
204
Annual Report 2008
The Company also monitors the parameters that affect the projection of exchange rate
fluctuations, in order to check the adequacy of the Company’s elected strategy to the risk
profile and purpose of the hedging policy established by the Company’s management.
These controls have been efficient, so far, both for the management of the portfolio
and for providing accounting information necessary to the recognition of the portfolio’s
results.
Currently, Company is studying the possibility of expanding the scope of its hedge policy
to encompass other market risk factors, such as indices, interest rates, and host contracts
(embedded derivatives).
3 - Risks
The derivative portfolio amount varies according to the US dollar rate variation and
domestic interest rates in Brazilian reais (future inter-bank deposits) and in US dollars
(coupon rate). Accordingly, the volatility of these risk factors affects the result of the
derivatives. This risk, however, is reduced by the receivables that support the transac-
tions before maturity, the recognition of exchange gains/losses and of gains/losses at
maturity, and the receipt of the corresponding asset cash flow, which is also valued by
the exchange rate in effect.
As the transactions were hired in the over-the-counter market, there is also the risk
of the counterpart, that is, the possibility of default by the corresponding financial
institution. To reduce this risk, the Company only signs contracts with banks minimum
rated as investment grade.
4 - Fair value of derivatives
As of December 31, 2008, there were no outstanding operations with derivatives in the
portfolio, and, therefore, there is no fair value to be determined.
The methodology to calculate the fair value of transactions was developed by the
Company’s risk area based on well-known methods usually adopted in the market (mark
to market). Briefly, for the derivatives currently included in the portfolio, the process
consists in estimating the break-even price for each contract, at maturity, according to
(1) spot rate, (2) domestic interest rate in Brazilian reais (future inter-bank deposits),
and (3) domestic interest rate in US dollars (coupon rate). The comparison between
the price calculated this way, and the price negotiated in each contract provides an
estimate of future gain/loss, which is adjusted to present value by fixed interest rate
in Brazilian reais (future inter-bank deposits).
205
Annual Report 2008
5 - Breakdown of the derivative portfolio
As of December 31, 2008, there were no outstanding operations. Negative financial
adjustments, generated by the operations in the year 2008 amounted to R$124,345
thousand.
Such negative adjustments were caused by the inversion of the trend of the US dollar
rate that, after almost five years of devaluation, started having valuation after August
2008, following the reductions in the prices of main commodities, especially after
October 2008, due to the worsening of the international financial crisis. In view of the
hedge logics used in the operations, as well as of the large fluctuation of the futures
market and the short time until the maturities of the contracts, the Company decided
to settle the derivative contracts and did not reverse them.
h.1) Embedded Derivatives
In 2004, the controlled company ELETRONORTE signed long-term contracts for elec-
tricity supply to three of its main clients. The monthly amounts of these long-term
contracts are established according to the aluminum international price (London Metal
Exchange - LME), used as basic asset to define the monthly value of the contracts.
The contracts are detailed below:
Contract date
Client
Initial
Maturity
Megawatt average volume
Albrás
Alcoa
BHP
7/1/2004
12/31/2024
7/1/2004
7/1/2004
12/31/2024
750 MW – up to 12/31/2006
800 MW – as from 01/01/2007
From 304.92 MW to 328MW
12/31/2024
From 353,08 MW to 492MW
These contracts include interest rate cap and floor band using aluminum price at the
LME as reference rate. LME’s maximum and minimum prices are limited to US$2,773.21/
tonnes and US$1,450/tonnes, respectively.
The Company informs that it does not operate with other kinds of derivatives, except
those mentioned in this explanatory note. Other information regarding this operation
is presented in explanatory note 19.
206
Annual Report 2008
III - Risks
a) Regulatory Risk
The Company, through its controlled companies, holds concessions to explore electricity
generation and transmission services, whose maturities under the terms of the current law
are pre-established. If those concessions are not renewed or are renewed at higher costs for
the Company, the current levels of profitability and activity may be changed.
b) Exchange Risk
Parte relevante do ativo da Companhia e do resultado de suas operações é afetada
significativamente pelo fator de risco da taxa de câmbio, em especial no que se refere
ao dólar norte-americano. Em 31 de dezembro de 2008, a Companhia possui créditos
decorrentes de financiamentos concedidos em moeda estrangeira no montante de R$
21.051.270 mil, equivalente a US$ 9,007,818 mil. Comparando-se os recebíveis em
moeda estrangeira com a dívida, observa-se uma cobertura de cerca de 5,1 vezes.
c) Credit Risk
The Company, through its controlled companies, in engaged in the electricity genera-
tion and transmission markets, supported by contracts executed in a regulated con-
tracting environment. By entering into bilateral contracts with electricity distributors,
the Company aims to minimize its credit risks through collateral mechanisms involving
trade receivables.
In transactions with industrial customers called ‘free consumers’, the credit risk is mi-
nimized through previous analyses of business conditions.
d) Price Risk
Until 2004, the prices of electricity resulting from the generation activity sold to
concessionaires were determined by ANEEL. As of Auction No. 001/2004 held by the
Regulatory Agency, generating companies started to sell their electricity to a larger
number of clients at market prices.
Electricity transmission has its prices defined by ANEEL, according to the determination
of the permitted annual revenue (RAP), deemed sufficient to cover operating costs and
maintain the economic and financial balance of the concession.
e) Market Risk
A significant portion of the electricity generated by ELETROBRÁS’ controlled companies
is sold by means of Contracts for Selling Electricity in the Regulated Environment (CCE-
AR), entered into due to the controlled company’s participation in electricity actions
held by ANEEL.
207
Annual Report 2008
NOTE 44 - TRANSACTIONS WITH RELATED PARTIES
The transactions of ELETROBRÁS with its subsidiaries, controlled companies, and specific
purpose companies are carried out at prices and compatible conditions with the ones used in
the market. Among the main operations with related parties, we can mention the loans and
financing granted at arm’s-length basis and/or under specific regulations on the matter. Other
operations were also established under normal market conditions.
The amounts referring the compensation of the Board of Directors and of the Management
Board are presented in note 41. The Company, as mentioned in note 3, does not make use of
share-based compensation.
There are no operations with individuals considered related parties, except for sharehol-
ders.
FURNAS
Consumers and resellers
Loans and financing
Return on investments
Advance for future increase in capital
Sundry obligations
Interest, commissions and fees
CHESF
Consumers and resellers
Loans and financing
Return on investments
Advance for future increase in capital
Sundry obligations
Interest, commissions and fees
R$ thousand
COMPANY
ASSETS
LIABILITIES
INCOME
5,345
1,178,001
251,607
31,154
-
-
1,466,107
1,875
3,460,807
541,878
294,397
-
-
4,298,957
-
-
-
-
339
-
339
-
-
-
-
1,368
-
1,368
-
-
-
-
-
105,725
105,725
-
-
-
-
-
429,001
429,001
208
Annual Report 2008
ELETRONORTE
Consumers and resellers
Loans and financing
Advance for future increase in capital
Sundry obligations
Interest, commissions and fees
ELETROSUL
Loans and financing
Return on investments
Advance for future increase in capital
Interest, commissions and fees
CGTEE
Loans and financing
Interest, commissions and fees
ELETRONUCLEAR
Loans and financing
Return on investments
Advance for future increase in capital
Sundry obligations
Interest, commissions and fees
ELETROPAR
Advance for future increase in capital
Return on investments
Sundry obligations
Interest, commissions and fees
3,922
7,589,415
-
-
-
7,593,337
592,161
135,713
94,576
-
822,450
574,954
-
574,954
2,902,701
28,749
30
-
-
2,931,480
62,285
8,268
-
-
70,553
-
-
-
46
-
46
-
-
-
-
-
-
-
-
-
-
-
1,482
-
1,482
-
-
799
-
799
-
-
-
-
1,008,696
1,008,696
-
-
-
16,803
16,803
-
13,598
13,598
-
-
-
321,873
321,873
-
-
1,931
1,931
209
Annual Report 2008
ITAIPU
Loans and financing
Return on investments
Interest, commissions and fees
CEAL
Loans and financing
Advance for future increase in capital
Interest, commissions and fees
CEPISA
Loans and financing
Interest, commissions and fees
MANAUS ENERGIA
Loans and financing
Interest, commissions and fees
CERON
Loans and financing
Interest, commissions and fees
ELETROACRE
Loans and financing
Advance for future increase in capital
Interest, commissions and fees
NATIONAL TREASURY
Obligations
Dividends payable
ELETROS
Social security contributions
BNDESPAR
Dividends payable
9,208,263
14,022
-
9,222,285
346,965
158,300
-
505,265
433,979
-
433,979
729,355
-
729,355
451,824
-
451,824
40,069
85,542
-
125,611
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,926,437
783,078
3,709,515
-
-
506,221
506,221
-
-
37,177
37,177
-
44,289
44,289
-
47,723
47,723
-
45,033
45,033
-
-
4,321
4,321
-
-
-
-
-
19,968
19,968
199,273
199,723
-
-
210
Annual Report 2008
R$ thousand
CONSOLIDATED
ASSETS
LIABILITIES
INCOME
SISTEMA DE TRANSMISSÃO NORDESTE
Permanent ownership interest
Interest on equity capital / dividends receivable
Trade accounts payable
Revenue from services
Interest on equity capital / dividends
Equity in earnings
Charges on the use of the electricity network
INTESA
Permanent ownership interest
Interest on equity capital / dividends receivable
Equity in earnings
ÁGUAS DA PEDRA
Permanent ownership interest
ENERGIA SUSTENTÁVEL
Permanent ownership interest
FACHESF
Trade accounts payable
Normal contributions
Actuarial contracts
Financial expense
Operating expenses
211
-
-
-
1,920
6,444
15,605
(9,666)
14,303
-
-
862
862
-
-
-
-
-
-
-
112,780
9,831
-
-
-
-
-
-
-
1,069
-
-
-
-
122,611
1,069
-
-
-
-
-
-
-
-
3,856
6,784
398,820
22,893
57
-
22,950
61,985
61,985
50,002
50,002
-
-
-
-
-
-
-
-
(299)
(33,689)
409,460
(33,988)
Annual Report 2008
ETAU
Permanent ownership interest
Advances for future increase in capital
Equity in earnings
ARTEMIS
Permanent ownership interest
Equity in earnings
SC ENERGIA
Accounts receivable
Permanent ownership interest
Advances for future increase in capital
Equity in earnings
UIRAPURU
Accounts receivable
Permanent ownership interest
Equity in earnings
RS ENERGIA
Permanent ownership interest
Equity in earnings
FUNDAÇÃO ELOS
Social security contributions
BRASNORTE
Permanent ownership interest
9,567
274
-
9,841
64,976
-
64,976
6,115
66,633
30,008
-
102,756
4,344
19,600
-
23,944
61,985
-
61,985
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
39,280
39,280
39,600
39,600
-
-
-
-
2,646
2,646
-
3,166
3,166
-
-
-
13,755
13,755
-
-
612
612
-
(138)
(138)
-
-
-
-
212
Annual Report 2008
AMAPARI
Permanent ownership interest
Equity in earnings
AETE
Permanent ownership interest
Other
Use of the electricity network
Equity in earnings
INTESA
Permanent ownership interest
Other
Use of the electricity network
Equity in earnings
PREVINORTE
Social security contributions
NUCLEOS
Normal contributions
Actuarial deficit
Actuarial expenses
ENERPEIXE
Permanent ownership interest
Interest on equity capital / dividends receivable
Accounts receivable
Interest on equity capital / dividends receivable
Equity in earnings
Revenue from the use of the electricity network
213
41,423
-
41,423
25,201
17
-
-
27,218
71,175
1,580
-
-
72,755
-
-
-
-
-
-
420,960
10,108
494
-
-
-
431,562
-
-
-
-
-
179
-
179
-
-
543
-
543
3,902
3,902
-
(110)
(110)
-
-
-
(692)
(692)
-
-
-
5,774
5,774
-
-
-
(7,308)
106,603
-
-
(6,707)
106,603
(14,015)
-
-
-
-
-
-
-
-
-
-
34,108
52,267
4,593
90,968
Annual Report 2008
TRANSLESTE
Permanent ownership interest
Interest on equity capital / dividends receivable
Trade accounts payable
Interest on equity capital / dividends receivable
Equity in earnings
Charges on the use of the electric network
TRANSUDESTE
Permanent ownership interest
Interest on equity capital / dividends receivable
Trade accounts payable
Accounts receivable
Interest on equity capital / dividends receivable
Equity in earnings
Charges on the use of the electric network
TRANSIRAPE
Permanent ownership interest
Trade accounts payable
Equity in earnings
Charges on the use of the electric network
CENTROESTE
Permanent ownership interest
BAGUARI
Permanent ownership interest
RETIRO BAIXO
Permanent ownership interest
13,420
414
-
-
-
-
13,834
8,500
120
-
19
-
-
-
8,639
6,029
-
-
-
-
-
126
-
-
-
126
-
-
(78)
-
-
-
-
-78
-
(53)
-
-
6,029
(53)
6,514
6,514
61,925
61,925
67,188
67,188
-
-
-
-
-
-
-
-
-
414
1,353
-630
1137
-
-
-
-
120
508
(396)
232
-
-
248
(275)
(27)
-
-
-
-
-
-
214
Annual Report 2008
SERRA DO FACÃO
Permanent ownership interest
CHAPECO
Permanent ownership interest
ENSE
Permanent ownership interest
Interest on equity capital / dividends receivable
Trade accounts payable
Accounts receivable
Interest on equity capital / dividends receivable
Equity in earnings
Revenue from the use of the electricity network
Charges on the use of the electric network
REAL GRANDEZA
Accounts receivable
Accounts payable
Normal contributions
Actuarial contracts
Operating expenses
215
273,713
273,713
270,855
270,855
1,129,104
10,642
-
513
-
-
-
-
-
-
-
-
-
-
(257)
-
-
-
-
-
1,140,259
(257)
932,667
-
(11,825)
(65,021)
(931,046)
-
-
-
-
-
-
-
-
-
-
-
-
34,642
54,376
4,593
(1,301)
92,310
-
-
-
-
-
(189,134)
932,667
(1,007,892)
(189,134)
Annual Report 2008
NOTE 45 - INSURANCE
Main property, plant and equipment in use at ELETROBRÁS are insured in accordance with
a coverage policy, taking into account the nature and degree of risk, at amounts considered
sufficient to cover possible significant losses. Insurance composition is as follows:
RISK
Amount Insured
Premium
R$ thousand
COMPANY AND CONSOLIDATED
Named perils
Aircraft perils
Various
20,741,014
18,572
688,672
21,448,258
61,985
476
7,411
69,872
Named perils - coverage for losses and material damages stemming from fire, lightning,
explosion of any kind and electric damages in the facilities.
Aircraft perils - coverage for losses incurred, refund of expenses and civil liability associa-
ted with accidents with aircrafts.
Various risks - coverage for portable equipment, local and international transportation,
and others.
NOTE 46 - STUDIES AND PROJECTS
These mainly refer to costs incurred by the Company on feasibility studies focusing the use
of hydrographical basins and transmission lines, for construction of new hydroelectric plants
and transmission systems.
The amount of expenditures incurred used to be treated as deferred expenses and presen-
ted in long-term assets. With the enactment of Law 11.638/2007, such expenses no longer
gather the necessary conditions to be represented as assets of the Company. Therefore, under
the terms of CPC Pronouncement 13, accumulated expenses until December 31, 2007, corres-
ponding to R$ 292,579 thousand were written-off against Retained Earnings. Starting in the
year 2008, expenses with feasibility studies and inventories are recognized in income and are
capitalized after their economic feasibility is established.
NOTE 47 - CORPORATE GOVERNANCE
In September 2006, the Company went through a restructuring process to comply with
the practices of Corporate Governance level I of BOVESPA (São Paulo Stock Exchange). Conse-
quently, the Company that had shares listed in the IBOVESPA index, is now also listed in the
Corporate Governance Index - IGC.
In September 2008, ELETROBRÁS obtained a registration with the US Securities and Ex-
change Commission - SEC. The listing of Company’s shares on the Stock Exchange of New York
(NYSE) occurred on October 31, 2008.
216
Annual Report 2008
Currently, ELETROBRÁS has two American Depositary Receipts programs related to common
shares and class “B” preferred shares.
The registration of the Company with SEC and the consequent listing of ADR programs
on the NYSE makes part of the strategic planning of the Company. It has been working with
the purpose of improving its visibility with shareholders, analysts and investors, both in the
equity and debt areas and aims to improve liquidity and prices of shares, as well as obtain fa-
vorable conditions when raising funds in the future for the Company’s investment programs.
NOTE 48 - RELATIONSHIP WITH INDEPENDENT AUDITORS
In compliance with the provisions of the Instruction 381 of the Brazilian Securities and
Exchange Commission of January 14, 2003, ELETROBRÁS informs that it uses the independent
auditing services of the firm BDO Trevisan Auditores Independentes. The said firm was engaged
on August 1, 2005 for execution of audit services of individual and consolidated financial sta-
tements of ELETROBRÁS, and the Company does not have any other service agreements with
the mentioned firm that not the financial statement audit services.
The independent auditors rendering individual audit services to the controlled companies
of ELETROBRÁS are the following:
CGTEE
CHESF
ELETRONORTE
ELETRONUCLEAR
ELETROSUL
FURNAS
ITAIPU
ELETROPAR
CERON
CEAL
CEPISA
ELETROACRE
MESA
BVENERGIA
Deloitte Touche Tohmatsu
RSM Boucinhas, Campos & Conti
BDO Trevisan
HLB Audilink e CIA
Horwath Tufani, Reis & Soares
HLB Audilink e CIA
BDO Trevisan
Russell Bedford Brasil
RSM Boucinhas, Campos & Conti
HLB Audilink e CIA
Ferreira e Associados Auditores Independentes
HLB Audilink e CIA
HLB Audilink e CIA
HLB Audilink e CIA
The Company’ policy in relation to its independent auditors is based on principles that
preserve the auditors’ independence.
217
Annual Report 2008
NOTE 49 - INFORMATION ON RELEVANT FACT
I - Guarantees given by CGTEE
In order to investigate the facts on the supposed guarantees given to Bank KfW Banken-
gruppe amounting to EUR 156,700 thousand (corresponding to approximately R$507,134
thousand), which would have been issued on behalf of CGTEE in favor of private companies,
the controlled company’s management started an investigation whose final report was appro-
ved by the Board of Directors on August 06, 2007. Among the conclusions of the Investiga-
tion, we highlight: (1) the assumed guarantees were constituted in violation to the Brazilian
law and of statutory standards of CGTEE, involving strong indications of forgery of documents
and signatures; and (2) CGTEE does not have, and has never had, any business or contract
relationships with the benefited companies.
On July 18, 2007, CGTEE notified the Bank KfW out-of court about the non-existence of
those supposed guarantees given on that company’s behalf. On September 10, 2007, it filed
a Declaratory Action of Document Falsification together with a Request for Submission of
Documents to Bank KfW.
The alleged guarantees given to one of the companies were formally canceled by Bank KfW
in November 2007.
Until the closing of these Financial Statements, there were no significant changes in the
matter. The Company’s management does not expect to incur losses on account of this issue.
José Antonio Muniz Lopes
President
Astrogildo Fraguglia Quental
Finance Director and Director of Relations with
Investors
Valter Luiz Cardeal de Souza
Engineering Director
Flávio Decat de Moura
Distribution Officer
Miguel Colasuonno
Administration Director
Ubirajara Rocha Meira
Technology Officer
João Vicente Amato Torres
Accountant
CRC-RJ-057,991/O-S-DF
218
Annual Report 2008
Attachment
219
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
CONSUMERS AND RESELLERS AS OF DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
COMPANY
Current
Falling due
12/31/2008
Overdue up
to 90 days
More than 90
days
12/31/2007
Total
Total
CONSOLIDATED
Circulante
12/31/2008
12/31/2007
12/31/2008
12/31/2007
Longo Prazo
Falling due
Overdue up
to 90 days
More than 90
days
Total
Total
AES ELETROPAULO
AES SUL
AES TIETÊ
AMPLA
ANDE
EBE
CEA
CEB
CEEE-D
CEEE-GT
CELESC
CELG
CELPA
CELPE
CEMAR
CEMIG
CESP
COELCE
COELBA
COPEL
CPFL
ELEKTRO
ENERSUL
ESCELSA
LIGHT
PIRATININGA
RGE
Sales at CCEE (Electricity Sales Chamber)
Regulatory assets
Electricity network use
PROINFA (Alternative electricity sources
incentive program)
Consumers
Public sector
Other
(-) Allowance for doubtful accounts
198.574
42.083
-
42.836
-
51.608
-
21.149
55.052
-
88.739
-
-
-
-
168.761
-
-
-
100.040
109.835
58.388
16.359
31.374
107.251
57.097
37.616
-
-
-
11.323
-
-
30.903
-
1.228.988
-
-
-
-
-
-
-
-
-
-
-
41.652
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5.212
-
-
-
-
46.864
-
-
-
-
-
-
-
-
-
-
-
410.722
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
22.995
-
-
-
-
433.717
198.574
42.083
-
42.836
-
51.608
-
21.149
55.052
-
88.739
452.374
-
-
-
168.761
-
-
-
100.040
109.835
58.388
16.359
31.374
107.251
57.097
37.616
-
-
-
39.530
200.238
33.336
-
28.399
-
65.661
-
13.169
29.507
-
50.824
153.575
-
-
-
196.914
-
-
-
74.090
91.718
49.982
11.738
28.834
134.829
62.310
24.304
-
-
-
89.010
-
-
30.903
-
1.709.569
-
-
10.821
-
1.349.259
235.100
61.031
761
77.634
55.251
69.843
11.501
34.251
83.252
250
102.242
33.858
43.305
47.808
30.259
238.590
2.500
30.367
64.146
180.742
130.982
105.961
29.371
47.895
172.966
58.932
43.675
307.564
86.879
339.129
11.323
368.883
23.214
577.414
(366.828)
3.340.051
26.873
527.909
12.802
41.652
410.722
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
235.100
61.031
761
77.634
55.251
69.843
566.283
47.053
83.252
250
102.242
486.232
43.305
47.808
30.259
238.590
2.500
30.367
64.146
180.742
130.982
105.961
29.371
47.895
172.966
58.932
43.675
308.646
86.891
364.472
39.530
290.496
52.031
690
66.548
38.779
90.474
423.275
41.205
43.993
3.432
59.016
187.784
38.513
47.465
24.511
279.535
2.267
30.794
65.096
160.921
118.581
99.840
18.473
49.075
218.111
1.208
30.373
383.448
448.361
134.620
89.010
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4.374
5.212
229.139
24.156
24.924
(26.873)
329.457
1.082
12
20.969
22.995
468.921
201.539
153.035
(1.148.035)
671.951
10.986
78.341
1.066.943
248.909
755.373
(1.541.736)
4.341.459
1.065.169
396.657
862.306
(1.679.733)
4.182.324
36.269
(5.231)
42.024
170.736
(69.623)
179.454
Annual Report 2008
Attachment I
COMPANY
Current
Falling due
12/31/2008
Overdue up
to 90 days
More than 90
days
12/31/2007
Total
Total
CONSOLIDATED
Circulante
12/31/2008
12/31/2007
12/31/2008
12/31/2007
Longo Prazo
Falling due
Overdue up
to 90 days
More than 90
days
Total
Total
AES ELETROPAULO
AES SUL
AES TIETÊ
AMPLA
ANDE
EBE
CEA
CEB
CEEE-D
CEEE-GT
CELESC
CELG
CELPA
CELPE
CEMAR
CEMIG
CESP
COELCE
COELBA
COPEL
CPFL
ELEKTRO
ENERSUL
ESCELSA
LIGHT
PIRATININGA
RGE
Sales at CCEE (Electricity Sales Chamber)
Regulatory assets
Electricity network use
PROINFA (Alternative electricity sources
incentive program)
Consumers
Public sector
Other
(-) Allowance for doubtful accounts
198.574
42.083
42.836
51.608
21.149
55.052
88.739
168.761
100.040
109.835
58.388
16.359
31.374
107.251
57.097
37.616
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
41.652
410.722
168.761
196.914
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
198.574
42.083
42.836
51.608
21.149
55.052
88.739
452.374
100.040
109.835
58.388
16.359
31.374
107.251
57.097
37.616
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
200.238
33.336
28.399
65.661
13.169
29.507
50.824
153.575
74.090
91.718
49.982
11.738
28.834
134.829
62.310
24.304
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
11.323
5.212
22.995
39.530
89.010
30.903
30.903
10.821
1.228.988
46.864
433.717
1.709.569
1.349.259
235.100
61.031
761
77.634
55.251
69.843
11.501
34.251
83.252
250
102.242
33.858
43.305
47.808
30.259
238.590
2.500
30.367
64.146
180.742
130.982
105.961
29.371
47.895
172.966
58.932
43.675
307.564
86.879
339.129
11.323
-
-
-
-
-
-
26.873
-
-
-
-
41.652
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4.374
5.212
-
-
-
-
-
-
527.909
12.802
-
-
-
410.722
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1.082
12
20.969
22.995
235.100
61.031
761
77.634
55.251
69.843
566.283
47.053
83.252
250
102.242
486.232
43.305
47.808
30.259
238.590
2.500
30.367
64.146
180.742
130.982
105.961
29.371
47.895
172.966
58.932
43.675
308.646
86.891
364.472
39.530
290.496
52.031
690
66.548
38.779
90.474
423.275
41.205
43.993
3.432
59.016
187.784
38.513
47.465
24.511
279.535
2.267
30.794
65.096
160.921
118.581
99.840
18.473
49.075
218.111
1.208
30.373
383.448
448.361
134.620
89.010
368.883
23.214
577.414
(366.828)
3.340.051
229.139
24.156
24.924
(26.873)
329.457
468.921
201.539
153.035
(1.148.035)
671.951
1.066.943
248.909
755.373
(1.541.736)
4.341.459
1.065.169
396.657
862.306
(1.679.733)
4.182.324
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
10.986
-
-
-
-
36.269
(5.231)
42.024
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
78.341
-
-
-
-
170.736
(69.623)
179.454
221
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
LOANS AND FINANCING GRANTED AS OF DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
12/31/2008
12/31/2007
CURRENT CHARGES
AVERAGE
RATE
VALUE
PRINCIPAL AMOUNT
CURRENT
NONCURRENT
CURRENT CHARGES
AVERAGE
RATE
VALUE
PRINCIPAL AMOUNT
CURRENT
NONCURRENT
COMPANY
CURRENT CHARGES
PRINCIPAL AMOUNT
CURRENT CHARGES
PRINCIPAL AMOUNT
12/31/2008
12/31/2007
VALUE
CURRENT
NONCURRENT
VALUE
CURRENT
NONCURRENT
CONSOLIDATED
AVERAGE
RATE
COMPANY AND
CONTROLLED COMPANIES
TOGETHER
FURNAS
CHESF
ELETROSUL
ELETRONORTE
CEAM
ELETRONUCLEAR
CGTEE
MANAUS
CEAL
CERON
CEPISA
ELETROACRE
ITAIPU
OTHER
CEMIG
COPEL
CEEE
DUKE
AES TIETÊ
AES ELETROPAULO
TRACTBEL
CELPE
CEMAR
CESP
OTHER
(-) Allowance for
doubtful accounts
10,00%
11,47%
7,56%
13,57%
12,69%
6,39%
10,49%
12,57%
11,43%
12,03%
11,02%
7,07%
6,76%
10,21%
9,33%
10,00%
10,00%
10,01%
12,00%
6,00%
5,09%
9,36%
-
8.082
31.575
1.168
15.500
-
2.176
816
-
3.435
1.472
984
351
-
65.559
2.457
429
172
2.375
4.819
274.406
707
867
1.154
1.165
100.658
78.073
440.873
77.274
231.349
-
64.870
-
140.254
39.874
53.617
84.663
9.557
60.944
1.281.348
63.022
4.548
66.693
168.691
224.659
117.931
29.611
17.173
26.352
28.121
331.872
1.091.846
2.988.359
513.719
7.342.566
-
2.835.655
574.138
589.101
303.656
396.735
348.331
30.161
18.355.581
35.369.848
403.565
67.142
30.085
439.233
982.694
-
41.114
77.957
317.532
235.273
1.572.714
8,86%
10,74%
7,54%
12,83%
5,75%
12,26%
0,00%
11,11%
7,17%
4,94%
4,73%
2,89%
7,07%
6,76%
8,33%
9,33%
10,00%
10,00%
10,01%
12,00%
6,04%
7,97%
9,44%
-
4.779
43.047
261
117.582
443
6.023
-
89
2.784
1.264
406
-
-
176.678
2.353
2.130
1.174
3.966
5.062
262.048
1.005
679
924
1.185
63.927
460.606
420.273
2.676
247.051
62.090
179.138
-
72.935
54.234
21.773
65.258
7.499
46.191
1.639.724
58.020
35.855
90.383
144.026
183.766
120.904
31.909
16.295
8.157
24.106
240.682
530.877
3.747.908
183.629
5.649.475
541.765
2.263.506
-
604.498
227.165
354.518
278.848
35.680
14.624.980
29.042.849
355.958
271.965
54.436
865.083
1.104.299
8.917
68.559
82.851
284.790
245.098
1.103.298
-
(58.221)
(59.454)
-
-
(38.785)
(41.845)
-
(58.221)
(59.454)
-
(38.785)
(41.845)
-
330.988
1.019.219
4.167.309
305.668
912.258
4.445.254
332.151
1.130.648
4.289.852
308.906
967.064
4.628.915
T O T A L
396.547
2.300.567
39.537.157
482.346
2.551.982
33.488.103
332.151
1.161.120
13.467.643
308.906
990.160
11.941.405
The long-term portions granted out of ordinary and sectorial funds, including re-lending, are payable in variable installments, as shown below:
2010
2011
2012
2013
2014
After 2014
TOTAL
COMPANY
CONSOLIDATED
2.976.960
1.014.050
2.781.021
947.306
2.595.367
884.067
2.501.559
852.112
2.434.402
829.237
26.247.848
8.940.871
39.537.157
13.467.643
AVERAGE
RATE
-
-
-
-
-
-
-
-
-
-
-
-
-
6,76%
8,39%
9,33%
10,00%
10,00%
9,30%
12,00%
4,44%
6,07%
9,33%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2.457
429
172
2.375
4.819
707
867
1.154
1.165
274.406
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
30.472
30.472
9.177.791
9.177.791
63.022
4.548
66.693
168.691
224.659
117.931
29.611
17.173
26.352
28.121
403.565
67.142
30.085
439.233
982.694
-
41.114
77.957
317.532
235.273
101.821
443.301
1.695.257
-
-
-
-
-
-
-
-
-
-
-
-
6,76%
8,39%
9,33%
10,00%
10,00%
9,85%
12,00%
6,02%
6,07%
9,32%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2.353
5.062
1.174
3.966
5.062
262.048
1.005
679
924
1.185
64.233
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
23.096
23.096
7.312.490
7.312.490
58.020
183.766
90.383
144.026
183.766
120.904
31.909
16.295
8.157
24.106
147.577
284.790
1.104.299
54.436
865.083
1.104.299
8.917
68.559
82.851
284.790
245.098
525.793
CURRENT CHARGES
PRINCIPAL AMOUNT
CURRENT CHARGES
PRINCIPAL AMOUNT
12/31/2008
12/31/2007
VALUE
CURRENT
NONCURRENT
VALUE
CURRENT
NONCURRENT
COMPANY
AVERAGE
RATE
CURRENT CHARGES
AVERAGE
RATE
12/31/2008
PRINCIPAL AMOUNT
VALUE
CURRENT
NONCURRENT
12/31/2007
CURRENT CHARGES
AVERAGE
RATE
VALUE
PRINCIPAL AMOUNT
CURRENT
NONCURRENT
CONSOLIDATED
Annual Report 2008
Attachment II
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6,76%
8,39%
9,33%
10,00%
10,00%
9,30%
12,00%
4,44%
6,07%
9,33%
-
2.457
429
172
2.375
4.819
274.406
707
867
1.154
1.165
101.821
-
-
-
-
-
-
-
-
-
-
-
-
30.472
30.472
63.022
4.548
66.693
168.691
224.659
117.931
29.611
17.173
26.352
28.121
443.301
-
-
-
-
-
-
-
-
-
-
-
-
9.177.791
9.177.791
403.565
67.142
30.085
439.233
982.694
-
41.114
77.957
317.532
235.273
1.695.257
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6,76%
8,39%
9,33%
10,00%
10,00%
9,85%
12,00%
6,02%
6,07%
9,32%
-
2.353
5.062
1.174
3.966
5.062
262.048
1.005
679
924
1.185
64.233
-
-
-
-
-
-
-
-
-
-
-
-
23.096
23.096
58.020
183.766
90.383
144.026
183.766
120.904
31.909
16.295
8.157
24.106
147.577
-
-
-
-
-
-
-
-
-
-
-
-
7.312.490
7.312.490
284.790
1.104.299
54.436
865.083
1.104.299
8.917
68.559
82.851
284.790
245.098
525.793
T O T A L
396.547
2.300.567
39.537.157
482.346
2.551.982
33.488.103
332.151
1.161.120
13.467.643
308.906
990.160
11.941.405
(58.221)
(59.454)
-
(38.785)
(41.845)
-
-
(58.221)
(59.454)
-
-
(38.785)
(41.845)
-
330.988
1.019.219
4.167.309
305.668
912.258
4.445.254
332.151
1.130.648
4.289.852
308.906
967.064
4.628.915
223
COMPANY AND
CONTROLLED COMPANIES
TOGETHER
FURNAS
CHESF
ELETROSUL
ELETRONORTE
CEAM
ELETRONUCLEAR
CGTEE
MANAUS
CEAL
CERON
CEPISA
ELETROACRE
ITAIPU
OTHER
CEMIG
COPEL
CEEE
DUKE
CELPE
CEMAR
CESP
OTHER
AES TIETÊ
AES ELETROPAULO
TRACTBEL
(-) Allowance for
doubtful accounts
AVERAGE
RATE
10,00%
11,47%
7,56%
13,57%
12,69%
6,39%
10,49%
12,57%
11,43%
12,03%
11,02%
7,07%
6,76%
10,21%
9,33%
10,00%
10,00%
10,01%
12,00%
6,00%
5,09%
9,36%
-
-
65.559
1.281.348
176.678
1.639.724
8.082
31.575
1.168
15.500
-
2.176
816
3.435
1.472
984
351
-
2.457
429
172
2.375
4.819
707
867
1.154
1.165
274.406
64.870
2.835.655
-
140.254
78.073
440.873
77.274
231.349
-
-
39.874
53.617
84.663
9.557
60.944
63.022
4.548
66.693
168.691
224.659
117.931
29.611
17.173
26.352
28.121
1.091.846
2.988.359
513.719
7.342.566
-
574.138
589.101
303.656
396.735
348.331
30.161
18.355.581
35.369.848
403.565
67.142
30.085
439.233
982.694
-
41.114
77.957
317.532
235.273
4.779
43.047
261
117.582
443
6.023
-
89
2.784
1.264
406
-
-
2.353
2.130
1.174
3.966
5.062
262.048
1.005
679
924
1.185
63.927
460.606
420.273
2.676
247.051
62.090
179.138
-
72.935
54.234
21.773
65.258
7.499
46.191
58.020
35.855
90.383
144.026
183.766
120.904
31.909
16.295
8.157
24.106
530.877
3.747.908
183.629
5.649.475
541.765
2.263.506
-
604.498
227.165
354.518
278.848
35.680
14.624.980
29.042.849
355.958
271.965
54.436
865.083
1.104.299
8.917
68.559
82.851
284.790
245.098
8,86%
10,74%
7,54%
12,83%
5,75%
12,26%
0,00%
11,11%
7,17%
4,94%
4,73%
2,89%
7,07%
6,76%
8,33%
9,33%
10,00%
10,00%
10,01%
12,00%
6,04%
7,97%
9,44%
-
-
100.658
331.872
1.572.714
240.682
1.103.298
The long-term portions granted out of ordinary and sectorial funds, including re-lending, are payable in variable installments, as shown below:
2010
2011
2012
2013
2014
After 2014
TOTAL
COMPANY
CONSOLIDATED
2.976.960
1.014.050
2.781.021
2.595.367
2.501.559
2.434.402
26.247.848
947.306
884.067
852.112
829.237
8.940.871
39.537.157
13.467.643
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
INVESTMENTS IN CONSOLIDATED COMPANIES AS OF DECEMBER 31, 2008
(In thousands of Brazilian reais)
COMPANIES’ DATA
Capital stock
FURNAS
CHESF
ELETROSUL
ELETRONORTE
ELETRONUCLEAR
ELETROPAR
MANAUS
ITAIPU (a)
TOTAL
TOTAL
31/12/2008
31/12/2008
CGTEE
31/12/2007
6.000.000
4.196.306
1.245.042
4.177.205
868.721
2.381.558
233.700
Advance for future capital increase
31.154
294.396
94.576
-
-
-
Shareholders’ equity
13.681.453
12.773.150
2.354.149
6.188.665
4.319.737
118.587
350.006
753.971
233.700
Net income (loss) for the year
ELETROBRÁS’S INTERESTS
Number of shares – thousand share lot
Common shares
Preferred shares
% of interest
Subscribed and paid-in capital
Voting
CHANGES IN INVESTMENTS:
Balances at beginning of period
Transference of stockholding control
Equity accounting – income (loss) for the year
Dividends
Accumulated translation adjustments
Adjustments as per Law 11.638/07
Conversion of advance for future capital increase into
capital stock
Balances at end of year
454.518
1.437.291
268.250
(2.424.558)
(282.070)
10.664
(292.202)
198.845
50.618.949
14.088.233
99,54
99,82
13.325.437
-
454.296
(251.607)
-
59.472
40.478
1.002
99,45
100,00
42.582.421
-
68.736.323
-
99,71
99,71
98,66
98,66
11.507.964
-
1.429.386
(541.878)
-
14.649
2.103.058
-
267.472
(135.713)
-
18.203
6.798.763
-
(2.021.630)
-
-
(4.128)
-
-
-
1.333.970
13.587.598
12.410.121
2.253.020
6.106.975
4.311.530
45.948
349.797
753.971
116.850
39.935.810
39.344.716
3.296.032
-
55.769
62.285
9.611.945
2.687.056
99,80
99,92
(281.535)
(28.749)
174.965
-
-
-
8.480.196
1.126.273
1.750.588
-
81,61
81,61
9.035
(8.268)
-
-
-
-
-
99,94
99,94
(292.026)
-
-
-
-
-
-
100,00
100,00
387.076
168.050
198.845
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1.149.525
(477.535)
168.050
(236.157)
(966.215)
28.285
263.161
1.333.970
-
-
-
-
-
-
-
-
-
50,00
50,00
28.285
4.446.849
45.181
641.823
88.565
39.344.716
38.672.726
Annual Report 2008
Attachment III
FURNAS
CHESF
ELETROSUL
ELETRONORTE
ELETRONUCLEAR
ELETROPAR
31/12/2008
31/12/2008
CGTEE
MANAUS
ITAIPU (a)
TOTAL
TOTAL
31/12/2007
Advance for future capital increase
31.154
294.396
94.576
-
6.000.000
4.196.306
1.245.042
4.177.205
3.296.032
-
55.769
62.285
868.721
2.381.558
233.700
-
-
-
Shareholders’ equity
13.681.453
12.773.150
2.354.149
6.188.665
4.319.737
118.587
350.006
753.971
233.700
454.518
1.437.291
268.250
(2.424.558)
(282.070)
10.664
(292.202)
198.845
50.618.949
14.088.233
99,54
99,82
-
-
-
40.478
1.002
99,45
100,00
-
-
-
42.582.421
68.736.323
-
99,71
99,71
-
-
-
-
98,66
98,66
-
-
-
1.333.970
6.106.975
13.325.437
11.507.964
2.103.058
6.798.763
454.296
(251.607)
1.429.386
(541.878)
267.472
(135.713)
(2.021.630)
59.472
14.649
18.203
(4.128)
13.587.598
12.410.121
2.253.020
9.611.945
2.687.056
99,80
99,92
4.446.849
-
(281.535)
(28.749)
-
174.965
-
4.311.530
8.480.196
-
81,61
81,61
45.181
-
9.035
(8.268)
-
-
-
45.948
1.126.273
-
1.750.588
-
99,94
99,94
641.823
-
(292.026)
-
-
-
-
100,00
100,00
387.076
168.050
198.845
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
39.344.716
168.050
(236.157)
(966.215)
28.285
263.161
38.672.726
-
1.149.525
(477.535)
-
-
-
-
-
50,00
50,00
88.565
-
-
-
28.285
-
-
1.333.970
-
349.797
753.971
116.850
39.935.810
39.344.716
225
COMPANIES’ DATA
Capital stock
Net income (loss) for the year
ELETROBRÁS’S INTERESTS
Number of shares – thousand share lot
Common shares
Preferred shares
% of interest
Subscribed and paid-in capital
Voting
CHANGES IN INVESTMENTS:
Balances at beginning of period
Transference of stockholding control
Equity accounting – income (loss) for the year
Dividends
Accumulated translation adjustments
Adjustments as per Law 11.638/07
Conversion of advance for future capital increase into
capital stock
Balances at end of year
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
PROPERTY, PLANT AND EQUIPMENT
(In thousands of Brazilian reais)
COMPANY
12/31/2008
ELETROBRAS
FURNAS
CHESF
CONTROLLED COMPANIES
12/31/2008
ELETRONORTE
ELETRONUCLEAR
ELETROSUL
ITAIPU
CGTEE
MANAUS
CEAL
CERON
CEPISA
ELETROACRE
ELETROPAR
TOTAL
Generation
In service
Accumulated depreciation
In progress
Transmission
In service
Accumulated depreciation
In progress
Distribution
In service
Accumulated depreciation
In progress
Management
In service
Accumulated depreciation
In progress
-
-
-
-
-
13.269
(740)
12.529
-
12.529
-
-
-
-
-
41.777
(28.812)
12.965
-
12.965
8.865.499
(3.064.423)
5.801.076
1.474.035
7.275.111
12.418.450
(6.336.871)
6.081.579
1.263.346
7.344.925
1.416
(549)
867
79
946
200.171
(87.704)
112.467
24.016
136.483
17.319.003
(6.940.820)
10.378.183
195.185
10.573.368
7.479.588
(3.321.142)
4.158.446
1.015.348
5.173.794
-
-
-
-
-
1.030.983
(486.686)
544.297
79.326
623.623
17.474.335
(7.254.557)
10.219.778
482.753
10.702.531
6.220.484
(2.897.953)
3.322.531
507.751
3.830.282
227.885
(62.600)
165.285
99.333
264.618
55.006
(24.480)
30.526
162.735
193.261
6.048.244
(2.042.099)
4.006.145
2.561.143
6.567.288
-
-
-
-
-
-
-
-
-
-
14.754
(6.851)
7.903
411
8.314
-
-
-
289.774
289.774
3.232.630
(1.355.168)
1.877.462
149.560
2.027.022
-
-
-
-
-
33.175
(9.947)
23.228
-
23.228
25.494
14.757.465
16.370.785
14.990.692
6.575.602
2.340.024
22.058.279
924.612
2.093.789
515.512
400.434
306.779
252.409
81.611.923
Concession-linked obligations
(-) Amortization and reversals
(-) Consumers’ contributions
(-) Federal Government’s participation
(-) Donations and grants for investment
(-) Other
-
-
-
-
-
-
-
-
-
-
(112.540)
(112.540)
-
(3.344)
(108.052)
(43.865)
(606)
(155.867)
-
(318)
(230.256)
(38.632)
(269.206)
-
-
(2.056)
-
(189)
(2.245)
-
-
-
(6.815)
-
(6.815)
TOTAL
25.494
14.644.925
16.214.918
14.721.486
6.573.357
2.333.209
22.058.279
924.612
1.817.916
303.502
244.582
306.779
93.568
47
80.262.674
Annual average depreciation rate (%)
Generation
Transmission
Distribution/Commercialization
Management
0,00%
0,00%
0,00%
7,95%
2,20%
3,00%
5,70%
9,30%
2,41%
2,98%
0,00%
7,18%
2,56%
2,76%
3,00%
15,00%
3,30%
0,00%
0,00%
10,00%
0,00%
3,19%
0,00%
7,51%
0,00%
0,00%
0,00%
0,00%
6,12%
0,00%
0,00%
12,50%
2,02%
0,00%
1,06%
1,57%
0,00%
0,00%
6,44%
4,19%
2,98%
0,00%
4,21%
9,25%
0,00%
0,00%
5,40%
5,60%
0,00%
0,00%
4,09%
5,29%
18.944.955
197.752
2.026.384
-
(1.004.830)
197.752
726.860
924.612
1.021.554
147.757
1.169.311
CONTROLLED COMPANIES
12/31/2008
-
-
-
-
-
-
-
-
-
-
673.588
(252.788)
420.800
88.585
509.385
14.311
(8.583)
5.728
399
6.127
47.318
(32.139)
15.179
1.545
16.724
-
-
-
-
-
480.320
(212.092)
268.228
95.904
364.132
33.626
(14.144)
19.482
96
19.578
-
-
-
-
1.105.448
(527.136)
578.312
245.443
823.755
286.948
(187.542)
99.406
1.317
100.723
(24.375)
(53.747)
(197.751)
-
(275.873)
(418)
(19.258)
(150.895)
(36.143)
(5.296)
(212.010)
(12.111)
(24.240)
(4.502)
(114.999)
(155.852)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
363.518
(172.817)
190.701
116.078
306.779
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
257.754
(65.738)
192.016
53.911
245.927
15.059
(9.825)
5.234
1.248
6.482
(3.266)
(146.828)
-
(8.747)
(158.841)
-
18.944.955
270.616
19.215.571
1.439.025
1.439.025
1.439.025
1.001.391
1.001.391
402.292
1.403.683
-
-
-
-
-
-
-
-
-
-
-
-
-
-
CONSOLIDATED
12/31/2008
70.923.490
(20.338.868)
50.584.622
6.149.668
56.734.290
30.803.446
(13.911.874)
16.891.572
2.936.005
19.827.577
3.109.929
(1.293.720)
1.816.209
699.333
2.515.542
2.727.388
(864.714)
1.862.674
671.840
2.534.514
(418)
(62.672)
(716.074)
(289.076)
(281.009)
(1.349.249)
187
(140)
47
-
47
47
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Annual Report 2008
Attachment IV
COMPANY
12/31/2008
ELETROBRAS
CONTROLLED COMPANIES
12/31/2008
17.319.003
(6.940.820)
10.378.183
195.185
17.474.335
(7.254.557)
10.219.778
482.753
10.573.368
10.702.531
6.048.244
(2.042.099)
4.006.145
2.561.143
6.567.288
7.479.588
(3.321.142)
4.158.446
1.015.348
5.173.794
6.220.484
(2.897.953)
3.322.531
507.751
3.830.282
-
-
-
-
-
1.030.983
(486.686)
544.297
79.326
623.623
227.885
(62.600)
165.285
99.333
264.618
55.006
(24.480)
30.526
162.735
193.261
8.865.499
(3.064.423)
5.801.076
1.474.035
7.275.111
12.418.450
(6.336.871)
6.081.579
1.263.346
7.344.925
1.416
(549)
867
79
946
200.171
(87.704)
112.467
24.016
136.483
13.269
(740)
12.529
12.529
41.777
(28.812)
12.965
-
12.965
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
289.774
289.774
3.232.630
(1.355.168)
1.877.462
149.560
2.027.022
-
-
-
-
-
33.175
(9.947)
23.228
-
23.228
-
-
-
-
(6.815)
(6.815)
-
-
-
-
-
-
-
-
-
-
-
-
-
14.754
(6.851)
7.903
411
8.314
Generation
In service
In progress
Transmission
In service
In progress
Distribution
In service
In progress
Management
In service
In progress
Accumulated depreciation
Accumulated depreciation
Accumulated depreciation
Accumulated depreciation
Concession-linked obligations
(-) Amortization and reversals
(-) Consumers’ contributions
(-) Federal Government’s participation
(-) Donations and grants for investment
(-) Other
TOTAL
Annual average depreciation rate (%)
Generation
Transmission
Management
Distribution/Commercialization
FURNAS
CHESF
ELETRONORTE
ELETRONUCLEAR
ELETROSUL
ITAIPU
CGTEE
MANAUS
CEAL
CERON
CEPISA
ELETROACRE
ELETROPAR
CONTROLLED COMPANIES
12/31/2008
18.944.955
-
18.944.955
270.616
19.215.571
1.439.025
-
1.439.025
-
1.439.025
-
-
-
-
-
1.001.391
-
1.001.391
402.292
1.403.683
197.752
-
197.752
726.860
924.612
2.026.384
(1.004.830)
1.021.554
147.757
1.169.311
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1.105.448
(527.136)
578.312
245.443
823.755
286.948
(187.542)
99.406
1.317
100.723
-
-
-
-
-
-
-
-
-
-
673.588
(252.788)
420.800
88.585
509.385
14.311
(8.583)
5.728
399
6.127
47.318
(32.139)
15.179
1.545
16.724
-
-
-
-
-
480.320
(212.092)
268.228
95.904
364.132
33.626
(14.144)
19.482
96
19.578
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
363.518
(172.817)
190.701
116.078
306.779
-
-
-
-
-
257.754
(65.738)
192.016
53.911
245.927
15.059
(9.825)
5.234
1.248
6.482
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
187
(140)
47
-
47
CONSOLIDATED
12/31/2008
TOTAL
70.923.490
(20.338.868)
50.584.622
6.149.668
56.734.290
30.803.446
(13.911.874)
16.891.572
2.936.005
19.827.577
3.109.929
(1.293.720)
1.816.209
699.333
2.515.542
2.727.388
(864.714)
1.862.674
671.840
2.534.514
25.494
14.757.465
16.370.785
14.990.692
6.575.602
2.340.024
22.058.279
924.612
2.093.789
515.512
400.434
306.779
252.409
47
81.611.923
-
-
-
-
(112.540)
(112.540)
-
(3.344)
(108.052)
(43.865)
(606)
(155.867)
-
(318)
(230.256)
(2.056)
(38.632)
(269.206)
(189)
(2.245)
-
-
-
-
-
-
-
-
-
-
-
-
(24.375)
(53.747)
(197.751)
-
(275.873)
(418)
(19.258)
(150.895)
(36.143)
(5.296)
(212.010)
(12.111)
(24.240)
(4.502)
(114.999)
(155.852)
-
-
-
-
-
(3.266)
(146.828)
-
(8.747)
(158.841)
-
-
-
-
-
-
(418)
(62.672)
(716.074)
(289.076)
(281.009)
(1.349.249)
25.494
14.644.925
16.214.918
14.721.486
6.573.357
2.333.209
22.058.279
924.612
1.817.916
303.502
244.582
306.779
93.568
47
80.262.674
0,00%
0,00%
0,00%
7,95%
2,20%
3,00%
5,70%
9,30%
2,41%
2,98%
0,00%
7,18%
2,56%
2,76%
3,00%
15,00%
3,30%
0,00%
0,00%
10,00%
0,00%
3,19%
0,00%
7,51%
0,00%
0,00%
0,00%
0,00%
6,12%
0,00%
0,00%
12,50%
2,02%
0,00%
1,06%
1,57%
0,00%
0,00%
6,44%
4,19%
2,98%
0,00%
4,21%
9,25%
0,00%
0,00%
5,40%
5,60%
0,00%
0,00%
4,09%
5,29%
-
-
-
-
227
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
PROPERTY, PLANT AND EQUIPMENT
(In thousands of Brazilian reais)
Generation
In service
Accumulated depreciation
In progress
Transmission
In service
Accumulated depreciation
In progress
Distribution/Commercialization
In service
Accumulated depreciation
In progress
Management
In service
Accumulated depreciation
In progress
COMPANY
12/31/2007
ELETROBRAS
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
53.704
(24.897)
28.807
-
28.807
FURNAS
7.657.039
(2.879.918)
4.777.121
1.973.816
6.750.937
12.180.452
(5.981.580)
6.198.872
1.252.690
7.451.562
1.480
(502)
978
39
1.017
195.521
(83.559)
111.962
20.535
132.497
COMPANY AND CONTROLLED COMPANIES TOGETHER
12/31/2007
ELETRONORTE
ELETRONUCLEAR
CHESF
ELETROSUL
CGTEE
ITAIPU
CEAL
CERON
CEPISA
ELETROACRE
CEAM
ELETROPAR
TOTAL
COMPANY AND CONTROLLED COMPANIES TOGETHER
12/31/2007
CONSOLIDATED
12/31/2007
17.143.404
(6.593.464)
10.549.940
169.207
10.719.147
6.936.848
(3.135.709)
3.801.139
1.175.238
4.976.377
-
-
-
-
-
895.235
(441.070)
454.165
131.056
585.221
19.762.511
(7.698.655)
12.063.856
580.437
12.644.293
5.990.161
(2.716.878)
3.273.283
567.970
3.841.253
1.054.108
(478.420)
575.688
291.518
867.206
319.186
(185.563)
133.623
72.177
205.800
6.036.619
(1.860.924)
4.175.695
2.294.264
6.469.959
-
-
-
-
-
-
-
-
-
-
-
-
-
93.768
93.768
2.914.876
(1.279.948)
1.634.928
280.638
1.915.566
-
-
-
-
-
13.137
(7.255)
5.882
4.170
10.052
44.586
(12.171)
32.415
1.986
34.401
28.807
14.336.013
16.280.745
17.558.552
6.480.011
2.043.735
486.334
17.567.061
460.496
344.221
421.254
209.010
358.304
Concession-linked obligations
(-) Amortization and reversals
(-) Consumers’ contributions
(-) Federal Government’s participation
(-) Donations and grants for investment
(-) Other
-
-
-
-
-
-
(81.998)
-
(28.539)
(2.003)
-
(112.540)
-
(3.344)
(108.052)
(43.865)
(380)
(155.641)
-
(24.482)
(266.480)
(18.260)
(36.072)
(345.294)
-
-
(3.617)
(204)
-
(3.821)
-
-
-
(6.815)
-
(6.815)
(418)
-
-
-
(171.502)
-
(10.859)
(24.240)
(4.489)
(90.438)
(171.920)
(130.026)
-
(10.050)
(3.604)
(117.091)
(2.210)
(132.955)
-
-
-
-
(119.786)
(119.786)
-
(544)
(10.636)
(121.938)
-
(133.118)
TOTAL
28.807
14.223.473
16.125.104
17.213.258
6.476.190
2.036.920
486.334
17.567.061
288.576
214.195
288.299
89.224
225.186
42
75.262.669
Annual average depreciation rate (%)
Generation
Transmission
Distribution/Commercialization
Management
0,00%
0,00%
0,00%
7,95%
2,20%
3,00%
5,70%
9,30%
2,41%
2,97%
0,00%
6,57%
2,56%
2,76%
3,00%
15,00%
3,30%
0,00%
0,00%
10,00%
0,00%
3,19%
0,00%
7,51%
6,12%
0,00%
0,00%
12,50%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
4,07%
4,94%
3,17%
0,00%
4,31%
9,64%
0,00%
0,00%
5,40%
5,60%
0,00%
0,00%
4,09%
5,29%
2,61%
0,00%
1,77%
1,64%
0,00%
0,00%
0,00%
0,00%
1.880.963
15.132.699
(1.576.832)
304.131
176.578
480.709
-
15.132.699
207.234
15.339.933
1.090.279
1.090.279
1.090.279
8.418
(2.793)
5.625
-
746.544
746.544
390.305
5.625
1.136.849
-
-
-
-
-
-
-
-
-
-
599.731
(226.590)
373.141
79.545
452.686
14.005
(7.688)
6.317
1.493
7.810
47.364
(30.746)
16.618
1.545
18.163
-
-
-
-
-
439.922
(193.724)
246.198
58.907
305.105
33.493
(12.705)
20.788
165
20.953
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
530.560
(270.146)
260.414
157.361
417.775
12.925
(9.455)
3.470
9
3.479
213.877
(55.457)
158.420
42.905
201.325
16.759
(10.314)
6.445
1.240
7.685
235.983
(92.801)
143.182
59.617
202.799
-
-
-
-
-
125.352
(64.952)
60.400
89.820
150.220
14.555
(9.723)
4.832
453
5.285
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
171
(129)
42
-
42
42
67.896.582
(20.733.340)
47.163.242
5.556.466
52.719.708
29.112.616
(13.114.115)
15.998.501
3.276.536
19.275.037
2.965.030
(1.289.791)
1.675.239
720.095
2.395.334
2.368.239
(807.322)
1.560.917
623.589
2.184.506
76.574.585
(82.416)
(49.279)
(445.168)
(486.167)
(248.886)
(1.311.916)
Annual Report 2008
Attachment IV - A
COMPANY
12/31/2007
ELETROBRAS
COMPANY AND CONTROLLED COMPANIES TOGETHER
12/31/2007
17.143.404
(6.593.464)
10.549.940
169.207
19.762.511
(7.698.655)
12.063.856
580.437
10.719.147
12.644.293
6.036.619
(1.860.924)
4.175.695
2.294.264
6.469.959
6.936.848
(3.135.709)
3.801.139
1.175.238
4.976.377
5.990.161
(2.716.878)
3.273.283
567.970
3.841.253
-
-
-
-
-
895.235
(441.070)
454.165
131.056
585.221
1.054.108
(478.420)
575.688
291.518
867.206
319.186
(185.563)
133.623
72.177
205.800
7.657.039
(2.879.918)
4.777.121
1.973.816
6.750.937
12.180.452
(5.981.580)
6.198.872
1.252.690
7.451.562
1.480
(502)
978
39
1.017
195.521
(83.559)
111.962
20.535
132.497
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
53.704
(24.897)
28.807
-
28.807
-
-
-
93.768
93.768
2.914.876
(1.279.948)
1.634.928
280.638
1.915.566
44.586
(12.171)
32.415
1.986
34.401
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
13.137
(7.255)
5.882
4.170
10.052
-
-
-
(3.617)
(204)
Accumulated depreciation
Generation
In service
In progress
Transmission
In service
In progress
In progress
Management
In service
In progress
Accumulated depreciation
Distribution/Commercialization
In service
Accumulated depreciation
Accumulated depreciation
Concession-linked obligations
(-) Amortization and reversals
(-) Consumers’ contributions
(-) Federal Government’s participation
(-) Donations and grants for investment
(-) Other
TOTAL
Annual average depreciation rate (%)
Generation
Transmission
Management
Distribution/Commercialization
FURNAS
CHESF
ELETRONORTE
ELETRONUCLEAR
ELETROSUL
CGTEE
ITAIPU
CEAL
CERON
CEPISA
ELETROACRE
CEAM
ELETROPAR
COMPANY AND CONTROLLED COMPANIES TOGETHER
12/31/2007
1.880.963
(1.576.832)
304.131
176.578
480.709
15.132.699
-
15.132.699
207.234
15.339.933
-
-
-
-
-
-
-
-
-
-
1.090.279
-
1.090.279
-
1.090.279
-
-
-
-
-
8.418
(2.793)
5.625
-
5.625
746.544
-
746.544
390.305
1.136.849
-
-
-
-
-
-
-
-
-
-
599.731
(226.590)
373.141
79.545
452.686
14.005
(7.688)
6.317
1.493
7.810
47.364
(30.746)
16.618
1.545
18.163
-
-
-
-
-
439.922
(193.724)
246.198
58.907
305.105
33.493
(12.705)
20.788
165
20.953
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
530.560
(270.146)
260.414
157.361
417.775
12.925
(9.455)
3.470
9
3.479
213.877
(55.457)
158.420
42.905
201.325
16.759
(10.314)
6.445
1.240
7.685
235.983
(92.801)
143.182
59.617
202.799
-
-
-
-
-
125.352
(64.952)
60.400
89.820
150.220
14.555
(9.723)
4.832
453
5.285
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
171
(129)
42
-
42
CONSOLIDATED
12/31/2007
TOTAL
67.896.582
(20.733.340)
47.163.242
5.556.466
52.719.708
29.112.616
(13.114.115)
15.998.501
3.276.536
19.275.037
2.965.030
(1.289.791)
1.675.239
720.095
2.395.334
2.368.239
(807.322)
1.560.917
623.589
2.184.506
28.807
14.336.013
16.280.745
17.558.552
6.480.011
2.043.735
486.334
17.567.061
460.496
344.221
421.254
209.010
358.304
42
76.574.585
(81.998)
(28.539)
(2.003)
-
-
(112.540)
-
(3.344)
(108.052)
(43.865)
(380)
(155.641)
-
(24.482)
(266.480)
(18.260)
(36.072)
(345.294)
(6.815)
(3.821)
(6.815)
-
-
-
-
-
-
-
-
-
-
-
-
(418)
-
-
(171.502)
-
(171.920)
-
(10.859)
(24.240)
(4.489)
(90.438)
(130.026)
-
(10.050)
(3.604)
(117.091)
(2.210)
(132.955)
-
-
-
-
(119.786)
(119.786)
-
(544)
(10.636)
(121.938)
-
(133.118)
-
-
-
-
-
-
(82.416)
(49.279)
(445.168)
(486.167)
(248.886)
(1.311.916)
28.807
14.223.473
16.125.104
17.213.258
6.476.190
2.036.920
486.334
17.567.061
288.576
214.195
288.299
89.224
225.186
42
75.262.669
0,00%
0,00%
0,00%
7,95%
2,20%
3,00%
5,70%
9,30%
2,41%
2,97%
0,00%
6,57%
2,56%
2,76%
3,00%
15,00%
3,30%
0,00%
0,00%
10,00%
0,00%
3,19%
0,00%
7,51%
6,12%
0,00%
0,00%
12,50%
0,00%
0,00%
0,00%
0,00%
0,00%
0,00%
4,07%
4,94%
3,17%
0,00%
4,31%
9,64%
0,00%
0,00%
5,40%
5,60%
0,00%
0,00%
4,09%
5,29%
2,61%
0,00%
1,77%
1,64%
0,00%
0,00%
0,00%
0,00%
229
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
LOANS AND FINANCING OBTAINED AS OF DECEMBER 31, 2008 AND 2007
(In thousands of Brazilian reais)
FOREIGN CURRENCY
Financial Institutions
Inter-American Development Bank - IDB
Corporación Andino de Fomento - CAF
Kreditanstalt fur Wiederaufbau - KFW
AMFORP & BEPCO
Dresdner Bank
Eximbank
Other
Bonus
Bonus - Dresdner Bank
Other
Federal treasury - ITAIPU
LOCAL CURRENCY
Receivables Investment Fund (FIDC)
Other
12/31/2008
12/31/2007
12/31/2008
12/31/2007
CURRENT CHARGES
PRINCIPAL AMOUNT
CURRENT CHARGES
PRINCIPAL AMOUNT
CURRENT CHARGES
PRINCIPAL AMOUNT
CURRENT CHARGES
PRINCIPAL AMOUNT
COMPANY
CONSOLIDATED
AVERAGE
RATE
VALUE
CURRENT
NONCURRENT
AVERAGE
RATE
VALUE
CURRENT
NONCURRENT
AVERAGE RATE
VALUE
CURRENT
NONCURRENT
AVERAGE RATE
VALUE
CURRENT
NONCURRENT
5,32%
4,76%
5,73%
6,50%
6,25%
2,15%
7,75%
5.489
10.340
202
-
259
2.544
2.510
21.344
5.347
5.347
-
-
43.482
-
31.349
128
31.349
56.822
2.359
165.490
369.600
1.635.900
95.514
-
95.513
482.981
585.322
3.264.830
5,62%
8,06%
5,73%
6,50%
6,25%
2,15%
6,40%
-
-
-
-
701.100
701.100
7,75%
-
-
4.578
1.934
199
-
266
1.721
366
9.064
4.052
4.052
-
-
32.957
6.959
24.773
296
24.772
34.767
1.790
126.314
-
-
-
-
313.091
184.089
100.540
303
100.539
330.291
16.629
1.045.482
531.390
531.390
-
-
5,32%
4,76%
5,73%
6,50%
6,25%
2,15%
7,75%
5.489
10.340
376
-
331
2.544
3.466
5.347
5.347
43.482
-
59.698
128
45.110
56.823
19.246
369.600
1.635.900
95.514
-
95.513
482.981
502.328
-
-
701.100
701.100
5.698
5.698
941.908
941.908
11.655.965
11.655.965
5,62%
8,06%
5,73%
6,50%
6,25%
2,15%
7,75%
4.578
1.934
479
-
382
1.721
558
9.652
4.052
4.052
6.202
6.202
32.957
6.959
47.610
296
35.859
34.767
14.858
313.091
184.089
123.378
303
111.625
330.291
34.699
-
-
531.390
531.390
667.338
667.338
9.179.553
9.179.553
22.546
224.487
3.181.836
173.306
1.097.476
26.691
165.490
3.965.930
13.116
126.314
1.576.872
33.591
1.166.395
15.538.901
19.906
840.644
10.808.419
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
52.114
52.114
224.977
237.534
462.511
86.930
2.671.731
2.758.661
35.674
35.674
306.419
248.172
554.591
277.296
1.943.353
2.220.649
26.691
165.490
3.965.930
13.116
126.314
1.576.872
85.705
1.628.906
18.297.562
55.580
1.395.235
13.029.068
a) The debt is guaranteed by the Federal Government and/or ELETROBRÁS.
b) The total debt in foreign currency, including charges, amounts to R$ 4.158.112 thousand (Company), corresponding to US$ 1,779,252 thousand,
and R$ 16.738.887 thousand corresponding to US$ 7,162,553 thousand. The percentage distribution by currency is as follows:
COMPANY
CONSOLIDATED
US$
81%
93%
EURO
6%
5%
YEN
13%
2%
c) Loans and financing incur interest at the average rate of 6.40% p.a. in 2008 and 7.03% p.a. in 2007.
d) The long-term portion of loans and financing denominated in thousands of US Dollars matures as follows:
COMPANY
CONSOLIDATED
2010
120.731
657.827
2011
120.731
514.798
2012
193.841
648.203
2013
240.325
2014
240.327
After 2014
781.063
646.627
618.488
4.743.566
TOTAL
1.697.018
7.829.509
Annual Report 2008
Attachment V
12/31/2008
12/31/2007
12/31/2008
12/31/2007
CURRENT CHARGES
PRINCIPAL AMOUNT
CURRENT CHARGES
PRINCIPAL AMOUNT
CURRENT CHARGES
PRINCIPAL AMOUNT
CURRENT CHARGES
PRINCIPAL AMOUNT
VALUE
CURRENT
NONCURRENT
VALUE
CURRENT
NONCURRENT
AVERAGE RATE
VALUE
CURRENT
NONCURRENT
AVERAGE RATE
VALUE
CURRENT
NONCURRENT
CONSOLIDATED
COMPANY
AVERAGE
RATE
5,32%
4,76%
5,73%
6,50%
6,25%
2,15%
7,75%
5.489
10.340
376
-
331
2.544
3.466
22.546
5.347
5.347
43.482
-
59.698
128
45.110
56.823
19.246
224.487
369.600
1.635.900
95.514
-
95.513
482.981
502.328
3.181.836
-
-
701.100
701.100
5.698
5.698
941.908
941.908
11.655.965
11.655.965
5,62%
8,06%
5,73%
6,50%
6,25%
2,15%
7,75%
4.578
1.934
479
-
382
1.721
558
9.652
4.052
4.052
6.202
6.202
32.957
6.959
47.610
296
35.859
34.767
14.858
173.306
313.091
184.089
123.378
303
111.625
330.291
34.699
1.097.476
-
-
531.390
531.390
667.338
667.338
9.179.553
9.179.553
26.691
165.490
3.965.930
13.116
126.314
1.576.872
33.591
1.166.395
15.538.901
19.906
840.644
10.808.419
26.691
165.490
3.965.930
13.116
126.314
1.576.872
85.705
1.628.906
18.297.562
55.580
1.395.235
13.029.068
52.114
52.114
224.977
237.534
462.511
86.930
2.671.731
2.758.661
35.674
35.674
306.419
248.172
554.591
277.296
1.943.353
2.220.649
AVERAGE
RATE
5,32%
4,76%
5,73%
6,50%
6,25%
2,15%
7,75%
FOREIGN CURRENCY
Financial Institutions
Inter-American Development Bank - IDB
Corporación Andino de Fomento - CAF
Kreditanstalt fur Wiederaufbau - KFW
AMFORP & BEPCO
Dresdner Bank
Eximbank
Other
Bonus - Dresdner Bank
Bonus
Other
Federal treasury - ITAIPU
LOCAL CURRENCY
Receivables Investment Fund (FIDC)
Other
21.344
165.490
3.264.830
126.314
1.045.482
5.489
10.340
202
-
259
2.544
2.510
5.347
5.347
-
-
-
-
-
43.482
369.600
-
1.635.900
31.349
128
31.349
56.822
2.359
95.514
-
95.513
482.981
585.322
5,62%
8,06%
5,73%
6,50%
6,25%
2,15%
6,40%
701.100
701.100
7,75%
-
-
-
-
-
-
-
-
-
-
-
-
4.578
1.934
199
-
266
1.721
366
9.064
4.052
4.052
-
-
-
-
-
32.957
6.959
24.773
296
24.772
34.767
1.790
-
-
-
-
-
-
-
313.091
184.089
100.540
303
100.539
330.291
16.629
531.390
531.390
-
-
-
-
-
a) The debt is guaranteed by the Federal Government and/or ELETROBRÁS.
b) The total debt in foreign currency, including charges, amounts to R$ 4.158.112 thousand (Company), corresponding to US$ 1,779,252 thousand,
and R$ 16.738.887 thousand corresponding to US$ 7,162,553 thousand. The percentage distribution by currency is as follows:
US$
81%
93%
EURO
6%
5%
YEN
13%
2%
COMPANY
CONSOLIDATED
COMPANY
CONSOLIDATED
c) Loans and financing incur interest at the average rate of 6.40% p.a. in 2008 and 7.03% p.a. in 2007.
d) The long-term portion of loans and financing denominated in thousands of US Dollars matures as follows:
2010
120.731
657.827
2011
120.731
514.798
2012
193.841
648.203
2013
2014
After 2014
240.325
240.327
781.063
646.627
618.488
4.743.566
TOTAL
1.697.018
7.829.509
231
CENTRAIS ELÉTRICAS BRASILEIRAS S.A - ELETROBRÁS
SUMMARIZED FINANCIAL STATEMENTS OF CONTROLLED COMPANIES AS OF DECEMBER 31
(In thousands of Brazilian reais)
ASSETS
LIABILITIES
Current
Noncurrent
TOTAL
Current
Noncurrent
Sharehold-
ers’ Equity
TOTAL
ASSETS
Current
Noncurrent
TOTAL
Current
Noncurrent
LIABILITIES
Sharehold-
ers’ Equity
TOTAL
BALANCE SHEET
2008
BALANCE SHEET
2007
Other
Property,
plant and
equipment,
Intangible
Assets and
Investments
Other
Property,
plant and
equipment,
Intangible
Assets and
Investments
Furnas
Chesf
Eletrosul
Eletronorte
Manaus
Boa Vista
Eletronuclear
CGTEE
Eletropar
Itaipu
2.242.891
2.050.322
753.020
2.237.348
703.626
61.418
863.099
111.518
107.033
2.226.006
2.048.138
212.570
958.947
570.308
1.204.797
50.524
891.998
10.876
1
3.843.996
15.998.268
16.497.310
2.334.767
15.071.074
1.832.093
129.169
6.602.538
928.849
93.696
40.811.662
20.289.297
18.760.202
4.046.734
17.878.730
3.740.516
241.111
8.357.635
1.051.243
200.730
46.881.664
2.461.587
1.924.551
637.861
2.103.273
935.639
132.961
429.997
123.597
82.142
3.474.740
4.146.167
4.062.501
1.054.724
9.586.792
2.050.907
46.958
3.607.901
577.640
1
43.173.224
13.681.543
12.773.150
2.354.149
6.188.665
753.970
61.192
4.319.737
350.006
118.587
233.700
20.289.297
18.760.202
4.046.734
17.878.730
3.740.516
241.111
8.357.635
1.051.243
200.730
46.881.664
2.026.416
1.789.042
488.855
2.354.090
15.184.024
19.564.530
257.662
632.005
16.421.300
18.468.004
2.280.372
3.401.232
2.773.971
1.704.403
420.269
2.143.497
1.093.996
17.488.676
20.726.169
2.513.896
273.970
53.909
751.170
184.785
97.209
603.077
46.993
793.831
11.213
1
1.576.054
2.453.101
85.105
186.007
6.486.309
8.031.310
527.777
93.691
723.775
190.901
652.425
43.023
548.126
74.988
72.846
3.358.851
13.431.708
19.564.530
4.897.597
11.866.004
18.468.004
777.212
2.203.751
3.401.232
9.594.867
1.245.551
45.154
8.617.406
20.726.169
555.125
97.830
2.453.101
186.007
3.027.607
4.455.577
8.031.310
6.579
1
642.208
118.054
177.130
723.775
190.901
37.015.473
1.530.658
4.437.118
31.047.697
37.015.473
2.378.875
34.459.468
Net operating
Operating
Revenue
Expenses
Service
Revenue
Other
Financial
Operating
Revenue
Income (loss)
Income (loss)
Income Tax and
Social
Contribution
Income (loss)
for the Year
Net Operating
Operating
Other
Financial
Operating
Income Tax and
Income (loss)
Income
Expenses
Revenue
Income (loss)
Income (loss)
for the Year
Social
Contribution
Service
Revenue
STATEMENT OF OPERATIONS
2008
STATEMENT OF OPERATIONS
2007
Furnas
Chesf
Eletrosul
Eletronorte
Manaus
Boa Vista
Eletronuclear
CGTEE
Eletropar
Itaipu
5.771.647
4.826.300
638.958
3.854.497
991.488
113.244
1.471.755
176.206
14.122
8.001.428
(4.858.236)
(2.610.935)
(328.689)
(3.663.420)
(596.472)
(156.612)
(1.085.042)
(378.454)
(3.818)
(3.077.817)
913.411
2.215.365
310.269
191.077
395.016
(43.368)
386.713
(202.248)
10.304
4.923.610
(9.851)
(108.419)
(14.701)
(1.120.506)
(28.207)
(1.278)
(330)
(92.190)
(12)
1.770
(318.399)
(464.979)
103.626
(1.495.129)
(162.558)
8.008
(589.158)
2.236
428
(2.864.458)
585.161
1.641.967
399.194
(2.424.558)
204.251
(36.638)
(202.775)
(292.202)
10.720
2.060.922
(130.643)
(204.676)
(130.874)
-
(5.406)
-
(79.295)
-
(56)
-
454.518
1.437.291
268.320
(2.424.558)
198.845
(36.638)
(282.070)
(292.202)
10.664
2.060.922
Equivalence = Other income
Profits sharing - Other income
5.105.173
(5.140.796)
(35.623)
3.980.753
(2.452.170)
1.528.583
549.145
(318.943)
4.624.070
(4.426.515)
230.202
197.555
810.290
(1.338.514)
(528.224)
109.435
(127.098)
1.271.697
(1.092.041)
131.122
19.089
(219.864)
(3.475)
(17.663)
179.656
(88.742)
15.614
(66.893)
(60.132)
(35.866)
(7.466)
(7.494)
267
183
235
-
1.055.733
(486.608)
101.744
(688.650)
(73.749)
9.371
(53.282)
19.358
609
953.217
981.843
296.080
(498.561)
(601.706)
(8.109)
118.880
(69.149)
16.223
5.967.576
(2.312.945)
3.654.631
(2.171)
(2.330.870)
1.321.591
(276.693)
(329.213)
(99.140)
(43.754)
-
-
-
-
(1.212)
(126)
676.524
652.630
196.940
(542.315)
(601.706)
(8.109)
117.668
(69.149)
16.097
1.321.591
Annual Report 2008
Attachment VI
ASSETS
Current
Noncurrent
TOTAL
Current
Noncurrent
LIABILITIES
Sharehold-
ers’ Equity
TOTAL
ASSETS
LIABILITIES
Current
Noncurrent
TOTAL
Current
Noncurrent
Sharehold-
ers’ Equity
TOTAL
BALANCE SHEET
2008
BALANCE SHEET
2007
Other
Property,
plant and
equipment,
Intangible
Assets and
Investments
Other
Property,
plant and
equipment,
Intangible
Assets and
Investments
Furnas
Chesf
Eletrosul
Eletronorte
Manaus
Boa Vista
Eletronuclear
CGTEE
Eletropar
Itaipu
2.242.891
2.050.322
753.020
2.237.348
703.626
61.418
863.099
111.518
107.033
212.570
958.947
570.308
50.524
891.998
10.876
1
2.048.138
15.998.268
20.289.297
16.497.310
18.760.202
2.334.767
4.046.734
15.071.074
17.878.730
2.103.273
1.204.797
1.832.093
3.740.516
129.169
6.602.538
928.849
93.696
241.111
8.357.635
1.051.243
200.730
2.461.587
1.924.551
637.861
935.639
132.961
429.997
123.597
82.142
4.146.167
13.681.543
20.289.297
4.062.501
12.773.150
18.760.202
1.054.724
9.586.792
2.050.907
46.958
577.640
1
2.354.149
4.046.734
6.188.665
17.878.730
753.970
61.192
350.006
118.587
233.700
3.740.516
241.111
8.357.635
1.051.243
200.730
46.881.664
3.607.901
4.319.737
2.226.006
3.843.996
40.811.662
46.881.664
3.474.740
43.173.224
2.026.416
1.789.042
488.855
2.143.497
273.970
53.909
751.170
184.785
97.209
1.530.658
2.354.090
257.662
632.005
1.093.996
603.077
46.993
793.831
11.213
1
4.437.118
15.184.024
16.421.300
2.280.372
17.488.676
1.576.054
85.105
6.486.309
527.777
93.691
31.047.697
19.564.530
18.468.004
3.401.232
20.726.169
2.453.101
186.007
8.031.310
723.775
190.901
37.015.473
2.773.971
1.704.403
420.269
2.513.896
652.425
43.023
548.126
74.988
72.846
2.378.875
3.358.851
4.897.597
777.212
9.594.867
1.245.551
45.154
3.027.607
6.579
1
34.459.468
13.431.708
11.866.004
2.203.751
8.617.406
555.125
97.830
4.455.577
642.208
118.054
177.130
19.564.530
18.468.004
3.401.232
20.726.169
2.453.101
186.007
8.031.310
723.775
190.901
37.015.473
Net operating
Operating
Other
Financial
Operating
Income Tax and
Income (loss)
Revenue
Expenses
Revenue
Income (loss)
Income (loss)
for the Year
Social
Contribution
Service
Revenue
Net Operating
Operating
Income
Expenses
Service
Revenue
Other
Financial
Operating
Revenue
Income (loss)
Income (loss)
Income Tax and
Social
Contribution
Income (loss)
for the Year
STATEMENT OF OPERATIONS
2008
STATEMENT OF OPERATIONS
2007
Furnas
Chesf
Eletrosul
Eletronorte
Manaus
Boa Vista
CGTEE
Eletropar
Itaipu
5.771.647
(4.858.236)
913.411
4.826.300
(2.610.935)
2.215.365
638.958
(328.689)
310.269
(9.851)
(108.419)
(14.701)
(318.399)
(464.979)
103.626
585.161
1.641.967
399.194
(130.643)
(204.676)
(130.874)
454.518
1.437.291
268.320
3.854.497
(3.663.420)
191.077
(1.120.506)
(1.495.129)
(2.424.558)
-
(2.424.558)
991.488
113.244
(596.472)
(156.612)
395.016
(43.368)
386.713
(28.207)
(1.278)
(162.558)
8.008
(330)
(589.158)
176.206
14.122
(378.454)
(202.248)
(92.190)
(3.818)
10.304
(12)
2.236
428
204.251
(36.638)
(202.775)
(292.202)
10.720
8.001.428
(3.077.817)
4.923.610
1.770
(2.864.458)
2.060.922
(5.406)
(79.295)
-
-
-
(56)
198.845
(36.638)
(282.070)
(292.202)
10.664
2.060.922
Eletronuclear
1.471.755
(1.085.042)
Equivalence = Other income
Profits sharing - Other income
5.105.173
3.980.753
549.145
4.624.070
810.290
109.435
1.271.697
131.122
19.089
5.967.576
(5.140.796)
(2.452.170)
(318.943)
(4.426.515)
(1.338.514)
(127.098)
(1.092.041)
(219.864)
(3.475)
(2.312.945)
(35.623)
1.528.583
230.202
197.555
(528.224)
(17.663)
179.656
(88.742)
15.614
3.654.631
(66.893)
(60.132)
(35.866)
(7.466)
267
183
(7.494)
235
-
(2.171)
1.055.733
(486.608)
101.744
(688.650)
(73.749)
9.371
(53.282)
19.358
609
(2.330.870)
953.217
981.843
296.080
(498.561)
(601.706)
(8.109)
118.880
(69.149)
16.223
1.321.591
(276.693)
(329.213)
(99.140)
(43.754)
-
-
(1.212)
-
(126)
-
676.524
652.630
196.940
(542.315)
(601.706)
(8.109)
117.668
(69.149)
16.097
1.321.591
233
Initials used in the Financial Statements
Albrás
AES Bandeirante
AES Eletropaulo
AES SUL
AES Tietê
Ampla
ANDE
Aneel
Artemis
BNDESPAR
CAJA
Cataguazes Leopoldina
CCEE
CDSA
CEA
Ceal
Ceam
CEB
CEB Lajeado
CELB
CEEE - D
CEEE - GT
Celesc
Celg
Cenf
Celpa
Celpe
Cemar
Cemat
Cemig
Centroeste de Minas
Cepisa
Ceron
Cesp
Chapecoense
Cnen
Coelce
Copel
CPFL
CTEEP
DUKE
Eate
EBE
Alumínio Brasileiro S,A,
AES Bandeirante Empreendimentos Ltda,
AES Eletropaulo Metropolitana de Eletricidade de São Paulo S,A,
AES Sul Distribuidora Gaúcha de Energia S,A,
AES Tietê S,A,
Ampla Energia e Serviços S,A,
Administración Nacional de Electricidad
Agência Nacional de Energia Elétrica
Artemis Transmisora de Energia S,A,
BNDES Participações S,A,
Caja Paraguaya de Judicaciones y Pensiones del Personal de Itaipu Binacional
Energisa Minas Gerais – Distribuidora de Energia
Câmara de Comercialização de Energia Elétrica
Centrais Elétricas Cachoeira Dourada S,A,
Companhia de Eletricidade do Amapá
Companhia Energética de Alagoas
Companhia Energética do Amazonas
Companhia Energética de Brasília
CEB Lajeado S,A,
Energisa Borborema – Distribuidora de Energia S,A
Companhia Estadual de Distribuição de Energia Elétrica
Companhia Estadual de Geração e Transmissão de Energia Elétrica
Centrais Elétricas de Santa Catarina S,A,
Centrais Elétricas de Goiás S,A,
Energisa Nova Friburgo – Distribuidora de Energia S,A,
Centrais Elétricas do Pará S,A,
Companhia Energética de Pernambuco
Companhia Energética do Maranhão
Centrais Elétricas Matogrossenses S,A,
Centrais Elétricas de Minas Gerais S,A,
Companhia de Transmissão Centro-Oeste de Minas
Companhia Energética do Piauí
Centrais Elétricas de Rondônia S,A,
Companhia Energética de São Paulo
Chapecoense Geração S,A,
Comissão Nacional de Energia Nuclear
Companhia Energética do Ceará
Companhia Paranaense de Energia
Companhia Paulista de Força e Luz
Companhia de Transmissão de Energia Elétrica Paulista
Duke Energy International. Geração Paranapanema S,A,
Empresa Amazonense de Transmissão de Energia S,A,
Empresa Bandeirante de Energia S,A,
Annual Report 2008
Attachment VII
EDP Lajeado
Elejor
Elektro
Elos
Eletros
Eletroacre
Eletroceee
Eletronet
Emae
Energipe
Enerpeixe
Enersul
EPTE
Etau
Escelsa
Fachesf
FGP
Fibra
FND
Guascor
Ibracon
Intesa
Investco
Itiquira
Light
MAE
Nucleos
Nuclep
Paulista Lajeado
Piratininga
Previnorte
Real Grandeza
Rede Lajeado
RGE
RS Energia
Saelpa
SC Energia
STN
Tangará
Tractbel
Transirapé
Transleste
Transudeste
Uirapuru
EDP – Lajeado Energia S,A,
Centrais Elétricas do Rio Jordão S,A,
Elektro Eletricidade e Serviços S,A,
Fundação Eletrosul de Previdência e Assistência Social
Fundação Eletrobrás de Seguridade Social
Companhia de Eletricidade do Acre
Fundação CEEE de Seguridade Social
Eletronet S,A,
Empresa Metropolitana de Águas e Energia S,A,
Energisa Sergipe – Distribuidora de Energia S,A,
Enerpeixe S,A,
Empresa Energética do Mato Grosso do Sul
Empresa Paraense de Transmissão de Energia S,A,
Empresa de Transmissão do Alto Uruguai S,A,
Espírito Santo Centrais Elétricas S,A,
Fundação CHESF de Assistência e Seguridade Social
Fundo Garantidor das Parcerias Público Privadas
Fundação Itaipu-BR de Previdência e Assistência Social
Fundo Nacional de Desenvolvimento
Guascor do Brasil Ltda,
Instituto dos Auditores Independentes do Brasil
Integração Transmissora de Energia S,A,
Investco S,A,
Itiquira Energética S,A,
Light Serviços de Eletricidade S,A,
Mercado Atacadista de Energia Elétrica
Nucleos Instituto de Seguridade Social
Nuclebrás Equipamentos Pesados S,A,
Paulista Lajeado Energia S,A,
Companhia Piratininga de Força e Luz
Previnorte – Fundação de Previdência Complementar
Real Grandeza – Fundação de Previdência e Assistência Social
Rede Lajeado Energia S,A,
Rio Grande Energia Elétrica S,A,
Empresa de Transmissão de Energia do Rio Grande do Sul
Energisa Paraíba – Distribuidora de Energia S,A,
Empresa de Transmissão de Energia de Santa Catarina S,A,
Sistema de Transmissão Nordeste S,A,
Tangará Energia S,A,
Tractbel Energia S,A,
Companhia Transirapé de Transmissão
Companhia Transleste de Transmissão
Companhia Transudeste de Transmissão
Uirapuru Transmissora de Energia S,A,
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Board of Executive Directors
Annual Report 2008
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Annual Report 2008
Eletrobrás’ Executive Board (EEB) is elected by the Board of Directors and is comprised of
five members: the president, who must be a member of the Board, and four officers. The EEB
works in compliance with the provisions set forth in the company’s By-Laws, and the guideli-
nes of the Board of Directors.
In December 2008, EEB was constituted as follows:
José Antonio Muniz Lopes President
Miguel Colasuonno Administration Officer
Flávio Decat de Moura Distribuition Officer
Astrogildo Fraguglia Quental Finance and Investors’ Relations Officer
Valter Luiz Cardeal de Souza Engineering Officer
Ubirajara Rocha Meira Technological Officer
BOARD OF DIRECTORS
President
Márcio Pereira Zimmermann Secretary of Power Energy of the Ministery of Mines
and Energy
Directors
José Antonio Muniz Lopes President of Eletrobrás
José Antonio Corrêa Coimbra Office Manager - Ministery of Mines and Energy
Luiz Soares Dulci Minister of General Seretary of the Republic
Arlindo Magno de Oliveira Electede by minoritary shareholders
Míriam Aparecida Belchior Palácio do Planalto – Casa Civil
Victor Branco de Holanda Minister of Finance
Nelson Rubner Moreira Management consultant
Wagner Bittencourt de Oliveira Director - Infrastructure Area, BNDES
AUDIT COMMITTEE
Title Holders
Haílton Madureira de Almeida Representative to the Federative Union/Treasury
Édison Freitas de Oliveira Federative Union Comptroller/MME
Danilo de Jesus Vieira Furtado Federative Union Comptroller/MME
Ana Lúcia de Paiva Lorena Freitas Holder of Common Share
Carlos César Meirelles Vieira Holder of Preferred ShareS
Title Holders
Luciana de Almeida Toldo Representative to the Federative Union/Treasury
Jairez Elói de Sousa Paulista Federative Union Controlling Shareholder/MME
Rodrigo Magela Pereira Federative Union Controlling Shareholder/MME
Elson Espedito Panoeiro Holder of Preferred Shares
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Independent Auditors Report
Annual Report 2008
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Annual Report 2008
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Summary Information
Annual Report 2008
General Cordenation:
Capital Department of Administration
Communication and Press Relations Area
Adress:
Central Office – Rio de Janeiro
Avenida Presidente Vargas, 409 / 13º. floor
CEP. 20071-003 – Centro
Rio de Janeiro – RJ
Phone number: (21) 2514-5151
Head Office – Brasília
SCN – Quadra 04 – Bloco B – Sala 203 / C – Centro Empresarial Varig
CEP. 70714-900 – Brasília – DF
Phone number: (61) 3329-7303
www.eletrobras.com
In case of suggestions, conlaints and further information, please contact the:
Communication and Press Relations Area
(55 21) 2514-5900
pgc@eletrobras.com
Graphic Project
Design AbóboraX
www.aboborax.com.br
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