Alexandre CitvarasBusiness DevelopmentFoxx Inova Ambiental Ltda.

In February 2013 was created a leader company in the waste management

sector in Brazil, through the merger of Foxx Inova Ambiental S.A. and

Haztec Tecnologia e Planejamento Ambiental S.A..

Foxx-Haztec focuses its activities in waste recovery, renewable energy, and

disposal in landfills. The company currently manages 30,000 tons of waste

daily, representing 15% of the national market.

Foxx-Haztec is the first company in the country to make efforts to implement

WtE in Brazil.

Fusão Foxx Haztec

PresentPast

About Foxx-Haztec

Future

Growth trend of the quantity, quality, and MSW collection

Obligation to properly dispose MSW, in accordance to the National Policy for Solid Waste

Governmental incentives for renewable energy investments and long-term contracts

Increased social and environmental awareness

Increased final waste destination costs of MSW and reverse logistics

40 40

36

7

2013 2020

Appropriate Destination Adjustment to Regulatory Changes Organic Growth

Inappropriate

Final Destination /

Non-Collected Waste

36mm tons

Evolution of MSW generation in Brazil

mm ton; kg/person/year

Favorable market

Source: Company, Abrelpe, EPA, IEEP, IBGE

53 57 61 62 73 76 83

336 358 378 382 379 380 391

0

50

100

150

200

250

300

350

400

450

0

20

40

60

80

100

120

140

160

180

200

2008 2009 2010 2011 2012 2013 2020

MSW Generation MSW per capita

Favorable conditions to develop Waste-to-Energy plants.

mm tons

7683

¹

Opportunity to

almost double

the market of

Appropriate

Final Destination

MSW evolution in Brazil

Fusão Foxx HaztecSector Overview

Source: Company and Abrelpe

Fusão Foxx HaztecSector Overview

RegionMunicipalities

ServedWaste(tpd)

Waste-to-Energy

Electric Power(MW)

Power Generation(MWh/year)

SOUTHEAST 228 19.667.322 1.324 7.946.393

SOUTH 139 4.387.894 295 1.772.887

MIDWEST 60 3.222.113 217 1.301.864

NORTH 15 1.851.864 125 748.228

NORTHEAST 80 6.520.858 439 2.634.690

TOTAL 522 35.650.051 2.401 14.404.061

To calculate the WTE project horizon that could be developed in Brazil only the

metropolitan areas were considered. Regions with over one million inhabitants were

the basis for this estimate. Thus, from the actual waste generation data, in each of these

locations, the potential for power generation from waste was calculated.

The calculated total potential is 2.4 GW, with an annual generation of 14,400 GWh. We

believe that this power potential can be reached only in the long run and it is possible

that it may never be reached. For the next 10 or 15 years we believe that the country

could reach up to 300 MW divided into 15 to 20 plants.

URE Barueri is a Waste-to-Energy facility

with capacity to handle 825 tons per day of

municipal solid waste. Its electrical power

generation capacity of 17.5MW shall be

installed in Barueri/SP.

This is the first Public Private Partnership

contract for treatment of waste and energy

recovery for a 30 years period. The main

client is the city of Barueri, but other public

and private clients will also be served.

The URE Barueri is a great step for waste

management in Brazil as it prepares the

way for the introduction of new, safe and

reliable technologies . Through this

project, Brazil stands out from its

neighboring countries and all of South

America.

URE Barueri

The URE Barueri will be located next to the Barueri WWTP owned by SABE SP. This is the

largest WWTP in Latin America. The URE Barueri will occupy a total area of 37.237m2. It will

integrate in a single location, the complete package of sanitation solutions , keeping São

Paulo at the forefront of waste and wastewater treatment in Latin America.

URE Barueri and Barueri

WWTP are integrated in

different ways:

• Use of recycled water

produced by the WWTP.

• Forwarding of URE

effluents to the WWTP.

• Integration to the SABESP

power substation, with

no need for installation of

a transmission line.

• Possibility of treating the

s ludge generated by the

WWTP

URE Barueri

WtE

Energy sale

Waste supply

Carbon credits

Operation & Maintenance

Construction

Debt

PPA

PPP

CERs

O&M

EPC

Funding

15 years

30 years

Source: Company

URE Barueri

March - 2011

Request for proposals Nº. 023/2010

- Request for proposals to provide collection anddisposal services

- Receiving of technical and commercial proposals

September - 2011

Receiving of proposals

- Barueri Energia and Barueri local government authority signed the contract

January - 2012

Signing of the PPP contract

November - 2009

Law Nº. 1.895PPP Municipal Program

July – 2012

Delivery of environmental studies

- Law that established the PPPMunicipal Program

October - 2014Signing of PPA

contract

January - 2015

Approval of IFC credit line

- Power purchase agreement with CEMIG

- Caixa made available aR$183 mm credit line - Approval of a R$42

mm funding line

August - 2014Government approves special credit line for

the Company

- Consórcio Barueri Energia was awarded the contract to provide collection and disposal services

October - 2011

Disclose of the contract winner

- Studies delivered to CETESB (regulatory agency)

November – 2012

Public hearing

- Barueri and Carapicuíba city councils held public hearings

December – 2012

Preliminary license obtained

- Preliminary license obtained with the conditions to obtain the installation permit

- ANEEL approves ERU Barueri

March - 2013

Authoritative Resolution nº4.001/13

- Partial delivery of the installation permit documents to LI

August - 2013

Delivery of installation permit

August - 2015

Approval of CEF credit line

- Approval of a R$183 mm credit line

December - 2015

Installation permit final delivery

- Receipt of the instrument of investiture

Up to Jul - 2016Credit disbursement

and beginning of construction

- Beginning of construction to start operations on Feb/2019

September - 2013

Beginning of the nationalization process

- Nationalization of the incineration equipment

March- 2016

Effectiveness of PPA Contract

- CEMIG approval for the effectiveness of the PPA

URE Barueri Timeline

The WtE challenges in Brazil are huge. The implementation of the URE Barueri project has required

enormous efforts of those involved and particularly of its investors and suppliers.

I call your attention to the following barriers as the main obstacles found for the rapid growth of the

sector in Brazil:

• The need for public long-term PPAs with appropriate prices for WtE projects feasibility;

• Specific public auctions for the energy provided by WtE’s;

• Learning of the technology curve. The Brazilian industry needs a higher demand of WtE

projects to reach lower investment costs;

• Parity tax incentives with other renewable energy sources;

• Increase gate fee prices on Waste input and design strong guarantees for the public partner

payments; Reduction of no-payment risks;

Conclusion

RIO DE JANEIRORua Joaquim Palhares, 40 | Cidade Nova Rio de Janeiro | RJ | CEP 20260-080Tel: +55 (21) 3974 6150 | Fax: +55 (21) 3974 6705

SÃO PAULORua Samuel Morse, 134 | 3º andar | Brooklin São Paulo | SP | CEP 04576-060Tel: +55 (11) 5103 5300 | Fax: +55 (11) 5103 5301

Alexandre Citvarasalexandre.citvaras@foxxpart.com.br+55 (11) 9-9434-8456+55 (11) 5103-5300