So far only 37 of the 144 projects approved under the program are under construction and will come online before the December 31, 2007 deadline, he said.

The project was launched in mid-2004 aiming to add 3,300MW of renewable power generation projects to Brazil's 90,000MW installed capacity. The program was supposed to be divided equally into 1,100MW each for wind power, small-scale hydroelectric and biomass projects.

The projects approved have signed 20-year power sale contracts with federal power holding company Eletrobrás.
 
"We are hoping that the program is a success but there are some important hurdles in getting projects off the ground," Feijão said.
 
The 54 wind projects face a long queue at Brazil's only wind power equipment supplier Wobben, a unit of German power company Enercon. So far only five wind projects are under construction.
 
"The program requires project developers to buy 60% of the equipment from local suppliers," said Feijão.
 
Although equipment for the 27 biomass and 63 small-scale hydro projects is mostly locally produced, these developers face a lack of access to financing, especially for the hydro projects

So far construction has started for only 16 biomass and 16 hydroelectric projects, Feijão said.
 
Another factor that has delayed some hydro projects is environmental licensing.

"Aneel just follows the programs and hears what the developers have to say," Feijão said. "The success of the program is more dependent on the [energy and mines] ministry and Eletrobrás."

The government has announced measures to ease financing rules offered by national development bank BNDES and is in talks with wind power equipment suppliers to set up shop in Brazil in the short term to supply turbines to wind projects.

"It's a good program because it diversifies Brazil's power generation park, which is mostly [over 70%] hydroelectric," Feijão said. "If there is a second version of Proinfa, maybe the government could rethink the financing rules and national content requirement."

While wind projects can be built quickly to start operations before the December 2007 deadline, the construction of biomass and hydro projects takes longer and therefore might be unable to meet the deadline, he said.