Cities are among the world´s largest consumersof electric energy, accountable for two-thirdsof total electricity consumption and for over 70 percent of global greenhouse gases emissions. Publicstreet lighting systems contribute significantly toa city´s energy consumption. In Brazil, the cost of energy for public lighting already represents thesecond most expensive item of most municipalities’ budgets, surpassed only by payroll expenditures.Furthermore, new regulations require all themunicipalities to own the city’s public lightingassets, making public lighting one of the few sectors in which local authorities have direct control over energy-consuming assets (contrastedwith other high energy-consuming sectors such as transport). As a result, the local authorities willhave every incentive to invest in and implementlighting projects by themselves.In Brazil, the current public street lighting inventory primarily consists of mercury and HPS lamps, which over time will tend to be replaced by more efficient technologies such as Light-Emitting Diodes (LEDs). This new technology is already in operation in some major cities in other countries. The availability and increasing spread of LED technology offers a unique opportunity for Brazilian cities to reduce their energy consumption. This is especially important and beneficial to cities, considering the sharp increase in energy prices in recent years.In spite of the substantial benefits associated with the conversion of the installed public lighting network in Brazilian cities, major economic financial and institutional obstacles still need to be overcome.In order to reap the benefits of conversion to LED,it is necessary to design and implement business models that can enable the necessary investments.These business models must take into account the diversity of Brazil’s municipalities. Furthermore,consideration must be given to designing financial solutions that can raise private sector capital while mitigating municipal credit and project performance risks.
Details
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Author
Meyer,Megan, Maurer,Luiz T. A., Freire,Javier, De Gouvello,Christophe, Consultoria,Pezco
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Document Date
2017/04/01
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Document Type
ESMAP Paper
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Report Number
124447
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Volume No
1
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Total Volume(s)
1
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Country
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Region
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Disclosure Date
2018/03/20
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Disclosure Status
Disclosed
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Doc Name
Lighting Brazilian cities : business models for energy efficient public street lighting
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Keywords
Municipalities; public street; united nations framework convention on climate change; multilateral investment guarantee agency; public lighting; long-term interest rate; business model; investment in energy efficiency; high pressure sodium lamp; multilateral financial institution; high cost of energy; Public Private Infrastructure Advisory Facility; regulatory asset base; global greenhouse gas emission; street light; regulation by contract; mercury vapor lamp; economies of scale; total energy consumption; water supply system; access to finance; per capita income; color reproduction; electric utility company; risk mitigation mechanism; fund management; amount of investment; expenditure over time; electricity distribution company; partial risk guarantee; water supply network; total electricity consumption; cost of quality; restrictions on credit; perception of security; provision of energy; official exchange rate; electricity distribution service; copyright clearance center; local economic activity; municipal infrastructure investment; increasing energy efficiency; investments in energy; cost of import; private sector financing; source of financing; transfer of asset; energy efficient equipment; cost of electricity
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Citation
Meyer,Megan Maurer,Luiz T. A. Freire,Javier De Gouvello,Christophe Consultoria,Pezco
Lighting Brazilian cities : business models for energy efficient public street lighting (English). Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/679281521548635917/Lighting-Brazilian-cities-business-models-for-energy-efficient-public-street-lighting