Votorantim Energia
Net revenues: R$ 3.6 bn
Adjusted EBITDA: R$ 44 mm
Social investment¹: R$ 7.7 mm
___Company resources: R$ 5.4 mm
___Votorantim Institute: R$ 2.3 mm
1Amount managed by the Votorantim Institute. It does not include additional resources for initiatives to combat COVID-19.
Joint venture2:
Net revenues: R$ 2.3 bn
Adjusted EBITDA: R$ 1.2 bn
250% Votorantim Energia and 50% CPP Investments.
Votorantim Energia is positioned as one of the main electricity companies in Brazil, operating in the segments of generation, commercialization and energy management services. In generation, the joint venture with CPP Investments, formed in 2018, has an installed capacity of 2.2 GW through 21 wind farms and the control of CESP, a publicly traded company valued at R$ 9.4 billion at the end of 2020. In commercialization, the company ended the year with more than 400 clients, with sales of 2 GWm in the free market, establishing itself as one of the three largest energy traders in the country, according to the Chamber of Electric Commercialization (Câmera de Comercialização de Energia Elétrica, CCEE). In energy services, Votorantim Energia manages capacity of 2.6 GW in hydroelectric power plants and 21 wind farms spread across the south, midwest and northeast of Brazil.
Advancing its growth strategy, even in the midst of the pandemic the joint venture approved an investment of R$ 2 billion for the construction of the Ventos do Piauí II and Ventos do Piauí III wind complexes, which are scheduled to start operating in 2022. Combined, they will add 409 MW to the joint venture’s installed capacity, bringing the total to 2.6 GW. Approximately 60% of the energy generated by these complexes is committed to CBA and Votorantim Cimentos, reflecting a self-production model. Since CESP was added to the joint venture portfolio, its structure and management processes have been revised, with an emphasis on the remediation of active and passive contingencies, as a way to continue in the direction of becoming one of the most efficient companies in the electricity sector.
In the commercialization segment, due to the restrictions imposed by the COVID-19 pandemic, electricity consumption fell in 2020. In addition, there was a decrease in the price of electricity in the spot market (short term)—through which companies sell surplus energy. On the other hand, the company took advantage of market opportunities to manage its energy balance and renegotiated contracts with some of its clients, making future payments more flexible. In 2020, it reached 420 active clients, excluding Votorantim’s portfolio companies, an increase of 6% compared to the previous year.
In the energy management services segment, the year was marked by the development of initiatives focused on increasing process agility and efficiency.
The joint venture, a generation platform, had solid operational and financial performance. In 2020, considering the results of CESP, Ventos do Piauí I and Ventos do Araripe III, it had total net revenues of R$ 2.3 billion and adjusted EBITDA of R$ 1.2 billion. Considering the commercialization and energy management segments as well as the joint venture, through equity, the consolidated net revenues was R$ 3.6 billion and consolidated adjusted EBITDA was R$ 44 million.
From an environmental standpoint, following the 2019 certification of the wind farms for carbon emission credits, the company sold approximately 1.2 million credits, preventing the emission of 1.2 million tons of carbon dioxide equivalent (tCO2e).
With regard to governance, the company carried out an evaluation of its processes based on best practices from the Brazilian Institute of Corporate Governance (Instituto Brasileiro de Governança Corporativa, IBGC), which resulted in a review of internal forums and improvements in the management system, to enable Votorantim Energia to influence changes in governance in its portfolio companies.
Another step taken by Votorantim Energia toward adherence to ESG principles was the definition of the company’s position in three main objectives: (i) achievement of clean energy certificates; (ii) identification, through inclusion in rankings and ratings, of the company’s reputation in this area; and (iii) issuance of green bonds. In parallel, the company became a signatory to the United Nations (UN) Global Compact, thereby committing to its agenda. Additionally, the company launched a diversity and inclusion program, which prioritized the training of young apprentices and interns and the hiring of people in situations of social vulnerability.
In innovation, Votorantim Energia’s digital transformation process matured, resulting in productivity gains, business development and more efficient information management. The company also made progress in the Usinas Conectadas (Connected Plants) Program, which enables centralized management of assets and aims to interconnect all hydroelectric and wind power plants by 2021. In addition, it became part of Energy Future, an innovation hub for the Brazilian electricity sector that will assist the company in pursuing projects, creating partnerships with startups, universities and research centers, and developing new products, services and business models.
