Moody's: Protracted drought to continue pressure on Brazilian hydro generators' cash flows

New York, September 30, 2014 -- Hydropower generators in Brazil will continue to face declines in cash flow at least through the impending rainy season as low reservoir levels force them to purchase power on the spot electricity market, says Moody's Investors Service in the report "Prolonged Drought Would Further Hurt Cash Flows of Brazil's Hydropower Generators." Pressures on cash flow are bound to continue because, given the severity of the drought in Brazil over the last two years, the main reservoirs are unlikely to be completely replenished in the rainy season, which should begin in November.

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