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Chinese Company Announced Its Plans to Make Billion-Dollar Investments in Brazil’s Renewable Energy Sector. Investment Expected to Generate New Jobs and Income for the Brazilian Market.
Geraldo Alckmin, Vice President and Minister of Development, Industry, Commerce, and Services, and Lyu Ze Xiang, President of Energy China International, met last Saturday (29) in São Paulo. The state-owned company, controlled by the government of Xi Jinping, plans to make investments of US$ 10 billion (equivalent to R$ 50 billion) in renewable energy generation in Brazil over the next few years.
Investments in Renewable Energy Will Be Directed to the Wind Market
According to the president of the Chinese company, the investments, which are expected to generate various jobs in Brazil, will be focused especially on the wind energy, transmission, fertilizers, and green hydrogen production markets.
Alckmin emphasizes that he received Energy China’s president, Lyu Ze Xiang, to discuss investment opportunities in renewable energy in Brazil, given that the country has a blessed climate and territory, while Energy China has capital and technology.
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According to the Vice President, together, it will be possible to advance in renewable energy and fertilizer production. Zexiang also met with the Minister of Mines and Energy, Alexandre Silveira, last Thursday (27). Soon after, the investment amount was disclosed by the ministry, which did not clarify, however, whether the Chinese company plans to invest in new projects or ones that are already operational.
Without going into details, Alexandre states that during the meeting, the company’s confidence in Brazil as a destination for a significant portion of the planned investments for the electric sector was highlighted, especially in renewable energy generation and hydrogen, as previously mentioned.
The minister emphasizes that the country has been attracting the largest investors in this sector and has demonstrated the government’s focus on consolidating regulatory stability, a favorable investment environment, legal security, and shows extreme confidence in the renewable energy hub the country will become in the coming years, generating jobs and social returns for Brazilians.
Chinese Companies Prioritize the Acquisition of Operational Companies
According to the ministry, the Chinese company has committed to consolidating the exchange with the ministry. Silveira chose Thiago Barral, Secretary of Planning and Energy Transition, as the focal point for monitoring investment proposals. As previously mentioned, it has not yet been revealed whether the Chinese intends to invest in new (greenfield) projects or those already in operation.
The Chinese have made their presence felt in the national market, prioritizing the acquisition of operational companies through direct investment, which makes it possible to generate cash flows immediately.
The announcement comes a few weeks after Luiz Inácio Lula da Silva’s (PT) visit to China. During the meeting, some agreements in the renewable energy sector were finalized. The meetings held last week are not related to the trip.
Federal Government Foresees Other Billion-Dollar Investments in the Sector
The arrival of Chinese state-owned conglomerates could mark a second cycle of investment from the Asian country in Brazil and comes at a time when the energy transmission auctions planned for this year are attracting several groups and are expected to raise around R$ 50 billion in investments.
During a trip to the states of Paraíba and Pernambuco in March, President Lula visited the Neoenergia Renewable Complex in Paraíba and participated in the unveiling of the inauguration plaque of the enterprise that combines wind and solar technologies to generate renewable energy in the State.
With an investment of R$ 3 billion, the complex consists of the Chafariz Wind Farm, with a capacity to generate 471.2 MW, and the Luzia Solar Park, with a maximum capacity of generating 149.2 MW, in addition to transmission lines and substations.
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