Highlights

 

• The Company was the winning bidder for the acquisition of Lot 1 of 02/2024 Aneel Transmission Auction consisting of approximately 780 km of power line to be implemented in the states of SC, PR, SP, MG and ES.

 

• During 3Q24, 50 wind turbines at the Serra do Assuruá Wind Complex (BA) went into commercial operations ahead of schedule and equivalent to 27% of total installed capacity.

 

ENGIE Brasil Energia (EGIE3) released its financial results for the 3rd quarter of 2024 on Tuesday. The Company recorded adjusted EBITDA of approximately R$1.7 billion in 3Q24, a reduction of 5.8% compared to the same period last year. Adjusted net income for 3Q24 was R$666 million, 28.2% below the profit for 3Q23.

 

Among the effects, the partial sale of the stake in TAG and increased costs of material and third-party services stand out, factors attenuated by the reduction in costs with the acquisition of electric energy for the portfolio and the positive result in operations in the short-term market.

 

The Company injected a total of R$ 1.9 billion in new projects in the third quarter and a grand total of R$ 7.5 billion over the first nine months of the year. Investments were mainly directed towards the conclusion of work on wind and photovoltaic complexes, in addition to the amount committed to the acquisition of photovoltaic assets carried out in February this year.

 

“We remain alert to opportunities for assisting Brazil in the capture of value from its mostly renewable matrix, directing our investments towards the execution of a balanced and sustainable long-term growth strategy that guarantees a good return to shareholders, in addition to competitiveness and security of supply to our customers and positive impacts for society as a whole,” highlights Eduardo Sattamini, CEO of ENGIE Brasil Energia.

 

At the end of 3Q24, ENGIE Brasil Energia had 9,290.2 MW of its own installed capacity, operating a generator park of 11 GW, made up of 109 plants, being 11 hydropower and 98 units of complementary sources — biomass, SHP, wind and solar —, of which 105 are fully owned by the Company and four (the hydropower plants of Itá, Machadinho and Estreito and the cogeneration Ibitiúva Bioenergética biomass unit) are commercially operated through the medium of partnerships with other companies.

 

Growth in renewable generation

 

The Santo Agostinho Wind Complex in the state of Rio Grande do Norte was finalized and entering full commercial operations in August. With 70 wind turbines and an installed capacity of 434 MW, this is ENGIE Brasil Energia’s fifth wind complex to go into operation, totaling around 1.7 GW of installed power from this source in the country.

 

In the same month, commercial operations at the Serra do Assuruá Wind Complex in the state of Bahia began, also ahead of the planned schedule, a landmark event in the installation of one of the largest wind power projects ever to be built in a single phase by the ENGIE Group in Brazil or worldwide. Comprising 24 wind farms in the municipality of Gentio do Ouro, the project had reached 80.4% completion by the end of the quarter, conclusion being expected for the first half of 2025, when the Complex will add more than 846 MW of capacity to the Company’s generator park.

The construction of the Assú Sol Photovoltaic Complex in the state of Rio Grande do Norte reached 58% completion by quarter end. The project will have an installed capacity of approximately 752 MWac (895 MWp). Commercial operations of the first photovoltaic unit are expected to come on stream in the fourth quarter of 2024 and operations in full by the fourth quarter of 2025.

 

Investments in energy transmission

 

Also, in 3Q24, the Company successfully bid for Lot 1 of 02/2024 Aneel Transmission Auction with about 780 kilometers of transmission line to be installed in the states of Santa Catarina, Paraná, Minas Gerais, São Paulo and Espírito Santo. The Graúna Transmission System, as it has been denominated, also includes continued servicing of an existing 162.6 kilometers of transmission line as well as two substations.

 

The third quarter also saw work beginning on the Asa Branca Transmission System, transecting the states of Bahia, Minas Gerais and Espírito Santo, a total of some 1,000 kilometers of power line, also including the expansion of five associated substations. In the case of work on the first stretch of 334 kilometers between the substations of Morro Chapéu II and Poções III, crossing 19 municipalities in the central-southern region of the state of Bahia, around 2000 direct jobs are expected to be created. In addition to Asa Branca and Graúna, the Company has more than 2,700 km of energized transmission lines in the states of Paraná, Pará and Tocantins.

 

“These projects strengthen the National Interconnected System (SIN), avoiding overloads and undervoltage on existing transmission lines, and reinforcing the interconnection between the Northeast and Southeast for energy flows from renewable sources”, explains Eduardo Takamori, the Company’s CFO and Investor Relations Director.

 

“Considering the recent curtailment scenario, which is partly due the imbalance between growth driven by excessive subsidies for renewable generation and the lack of speed in the expansion of transmission systems, accelerating of the delivery of energy transmission projects by the companies that won the Aneel auctions is essential for restoring stability to the electricity sector”, concludes Takamori.

 

Evolution of the Free Energy Market

 

In 3Q24, net operating revenue was R$2.5 billion in in the third quarter of this year, 0.9% higher than the same period in 2023, with a positive effect due to the increase in sales volume and transmission revenues.

 

Also in this third quarter, ENGIE Brasil Energia reported an increase of 55.1% in the total of free consumers compared to the same period last year. The Company maintained a share of 7.5% of the total free energy market.

 

“We work with offers that simplify access to the Free Energy Market, as well as customized energy and decarbonization products for customers of all sizes. Our guaranteed delivery of the contracted energy brings confidence and security to long-term partnerships, which has provided us with good results in the face of fierce competition to capture this market”, highlights Takamori.

 

The average selling price, net of charges on revenue and trading operations, was R$ 215.96/MWh in the third quarter, 3.6% lower than R$223.97/MWh in 3Q23. Excluding the impact of reimbursement in the quarters, the average selling price of energy fell from R$ 228.84/MWh in 3Q23 to R$ 226.92/MWh in 3Q24, a reduction of 0.8%.

 

The price reduction between periods was largely driven by the improvement in the hydrological scenario in recent years, combined with an increase in the supply of renewable energy and by growth in reimbursements already mentioned.