TPI, Alupar, Copel Win Concession of Three Major Hydropower Projects in Brazil

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Researched by Industrial Info Resources (Sugar Land, Texas)--On July 30, the Brazilian government held an auction in São Paulo, putting up three major hydropower projects for tenders and securing energy supply contracts from these and several others that had been previously awarded. The three projects had received their preliminary licenses after they completed and passed all environmental studies and evaluations.

The Garibaldi hydroelectric project, a 177-megawatt (MW) power station that is to be built in the southeastern state of Santa Catarina, was awarded to Triunfo Participações e Investimentos (TPI) (São Paulo, Brazil). TPI bid for 107.08 reais (US$61) per megawatt-hour (MWh). That offer represented a 19% reduction from the opening price set at 133 reais (US$76) per MWh.

Garibaldi is to have three 58.3-MW hydraulic turbines, plus a 2.43-MW auxiliary one. Construction should begin by mid-2011, and all units are expected to be brought online in 2015. Total investment for this project is nearly $510 million.

Ferreira Gomes is the second project that was awarded at the event. This hydropower plant will be in the northern state of Amapá and have an operational capacity of 252 MW. Alupar Investimento S.A. (São Paulo) was granted concession rights to build, own and operate this project after bidding 69.78 reais (US$40) per MWh. This value was 16% less than the maximum value set up by Brazil's energy regulatory agency, which was the starting bid of 83 reais (US$47) per MWh. The total value of Ferreira Gomes is estimated to be $725 million.

Once operational, Ferreira Gomes should have three 84-MW hydro turbines. Construction should begin in the first quarter of next year, with commercial operations of its three units beginning in December 2014, February 2015 and April 2015, respectively.

The third power project tendered last week was Colíder hydro power station. Concession of this plant was received by Companhia Paranaense de Energia (NYSE:ELP) (Copel) (Curitiba, Brazil). Copel defeated its contenders when it offered 103.40 reais (US$59) per MWh, marking an 11% reduction with regard to the opening bid.

Colider will be on the river Teles Pires, in the boundary of the states of Mato Grosso and Pará. It will have an operational capacity of 342 MW. Work on the site is expected to begin in the last quarter of 2011, and commercial operation of the plant should begin four years later. The total investment value for this project has been calculated at nearly $566 million.

All three winning companies have 25 days to submit all documents requested by ANEEL, which is Brazil's energy regulatory agency. ANEEL will then analyze those documents and might request additional information and clarifications before approving the auction's results. Once approvals are granted, the projects will be formally awarded by Brazil's Ministry of Energy and Mines.

For additional information on upcoming energy auctions in Brazil, view June 30, 2010, article - Three Energy Auctions in Brazil to Secure Growth in Power Generation for Next Five Years; and July 20, 2010, article - Nine Major Hydroelectric Projects in Brazil Likely to Release Construction Tenders Before Year's End.

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