At the risk of sounding like a broken record, I will reiterate my often-stated belief that investors need at least some exposure to emerging markets equities. This asset class should continue to benefit from favorable demographic trends, strong GDP growth, and the rapidly expanding ranks of the middle-class consumer.

Emerging markets carry a certain amount of risk, but one way to hedge your bets is by looking for companies that are market leaders in their home markets, have strong growth prospects, and are attractively valued -- essentially, blue-chip companies like PetroChina (NYSE:PTR), America Movil (NYSE:AMX), and Cemex (NYSE:CX).

One such company that investors might want to take a gander at, while not in the same league size-wise, is Brazil's CompanhiaEnergetica de Minas Gerais (NYSE:CIG), better known as CEMIG. In simple terms, I believe that this large electric utility should benefit from increased demand for power as Brazil's economic growth accelerates; is executing a well-planned expansion strategy; and carries an attractive valuation.

CEMIG -- 51% owned by the state of Minas Gerais -- is one of the largest integrated electric utility operators in Brazil. As of Dec. 31, 2005, the company operated 49 hydroelectric plants, four thermoelectric plans, and one wind farm (can you say green power?) and supplied power to more than six million customers over 245,000 miles of distribution lines. At the present time, CEMIG derives roughly 68% of its power needs from its internal generation capacity and purchases the rest from third-party sources.

Pretty vanilla stuff, isn't it? Let's get to the spice.

Power demand in Brazil
Despite Brazil's relatively disappointing GDP growth rate of 2.5% in 2005, CEMIG's electrical power sales increased at a rate of 4.5%, to roughly 39,600 Gigawatt hours (GWh). Given the fact that the Brazilian Central Bank has been aggressively cutting interest rates from a whopping 19.75% last September to just 13.25% currently (the lowest rate in 20 years), I find it likely that Brazil's economic growth is just beginning to accelerate and that power demand will increase accordingly . and may end well above the current estimates of 4.5% demand growth expected by the Brazilian National Agency for Electric Utilities (ANEEL).

Another fact to consider: Brazilians currently use about 2,000 kilowatt-hours of electricity per person annually, 20% less than their neighbors in Chile, and well below the 13,000-kilowatt usage posted in the U.S.

Think there's a tad bit of room for growth?

CEMIG's expansion plans
At present, CEMIG holds roughly a 7% share of Brazil's generation market, a 12% position in the transmission market, and a 5% share of the distribution market. While seemingly ambitious, management's stated 30-year goal is to hold a 19% share of the generation market and a matching 19% share of the distribution market.

I know it's virtually impossible to judge long-term plans and results by short-term results, but CEMIG certainly seems intent on pursuing this goal. Earlier this year, CEMIG was the head of a consortium that purchased 80% of Light, an electricity utility in the state of Rio de Janeiro which serves more than 3 million customers. Other moves included CEMIG's purchase of a number of transmission lines from another operator and the formation of a joint venture in Chile. These types of acquisitions certainly seem to be working out -- the volume of electricity sold in the third quarter climbed some 31%.

In addition to its acquisitions, CEMIG is investing in new generation facilities, including four new hydroelectric plants with a total generating capacity of 850 MWs.

Shares of CEMIG have enjoyed a nice run this year, advancing some 25%, and currently trade at 10 times fiscal 2007 estimates. Given the growth prospects of energy demand in Brazil, the company's well-executed expansion plans, and the fact that shares should offer a yield north of 6% in 2007, I believe that investors might want to examine CEMIG's prospects in a closer light.

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Fool contributor Will Frankenhoff is enjoying his time writing for The Fool more than playing golf, reading The Financial Times, or rooting for the Giants. He welcomes your feedback. Will does not own shares in any of the companies mentioned above. The Fool has a disclosure policy.