Brazil's Energy Regulatory Agency Confirms Opening Bids for Reserve Energy and Alternative Sources Auctions

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Researched by Industrial Info Resources (Sugar Land, Texas)--On July 22, Brazil's Energy Regulatory Agency (ANEEL) set the price for opening bids at the Reserve Energy and Alternative Sources auctions, scheduled to take place on August 25 and 26 in São Paulo.

The Reserve Energy Auction will award energy supply contracts to biomass-fueled, small hydroelectric, and windfarm projects that will operate at times of peak load.

The Alternative Sources Auction will involve power generation projects based on non-conventional sources of energy: small hydroelectric projects not exceeding 30 megawatts (MW), biomass-fueled thermoelectric projects and windfarms.

For the Reserve Energy Auction, the opening bid for biomass-fueled projects was set at approximately $88.64 per megawatt-hour (MWh). Energy coming from small hydroelectric projects was priced at 155 $88.07 per MWh. Lastly, windfarms included in this auction received $94.89 per MWh. The opening bids for the Alternative Sources Auction are the same for windfarm and hydroelectric contracts. The only difference is found in the price of energy that will be generated at biomass-fueled plants, which was fixed at $94.89 in the auction.

Energy supply contracts will be awarded to participants bidding the lowest amount per megawatt-hour.

Taking into consideration suggestions made by associations of independent energy producers after last December's first exclusive auction for windfarms, ANEEL reduced the minimum amount of energy that can bid out from 1 MW to 0.1 MW.

In the past few days, some Brazilian Power Industry organizations have complained that opening bids have fallen short of expectations, especially in the case of small hydroelectric projects. They pointed out that this situation may work against any possibilty of successful participation for a considerable number of registered projects.

For additional information about the three energy auctions on schedule in Brazil, see June 30, 2010, article - Three Energy Auctions in Brazil to Secure Growth in Power Generation for Next Five Years.

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