Baixa do Feijao Wind Park

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The company EDP Renovaveis Brasil S.A., owned by the Portuguese EDP Energias de Portugal, was granted authorizations to build four wind parks located in the municipality of Jandaira, state of Rio Grande do Norte (120 MW in total capacity). The 35-year contracts were signed with the regulatory agency ANEEL starting in August 2012. The company EDP Renovaveis Brasil created four special purpose companies to manage the complex: Central Eolica Baixa do Feijao S.A. I (30 MW) Central Eolica Baixa do Feijao S.A. II (30 MW) Central Eolica Baixa do Feijao S.A. III (30 MW) Central Eolica Baixa do Feijao S.A. IV (30 MW) The power plants were named EOL Baixa do Feijao I, EOL Baixa do Feijao II, EOL Baixa do Feijao III and EOL Baixa do Feijao IV. The total investment in the power plants was estimated at US$ 199.1 million (BRL 468 million) The project was financed with a loan granted by the state-owned development bank BNDES approved in December 2014 (US$ 119 million or BRL 306.3 million). The government periodically runs public bidding for the sale of energy to the country´s distribution companies. The power plants EOL Baixa do Feijao I, II, III, IV won the public bidding that took place in 2011, by offering an average tariff of US$ 59.4/MWh (BRL 97 /MWh). The project companies signed 20-year power purchase agreements with the several electricity distribution companies. The sponsor committed to start supplying to the market in 2016. The company was granted the right to take part in the government program called Regime Especial de Incentivos para o Desenvolvimento da Infra-Estrutura (Reidi). Companies selected to take part in this program were given tax cuts in the acquisition of capital equipment and construction material acquired both in the domestic and international markets (this incentive represented a cost reduction of about 9.25%). In addition, the company was allowed to use accelated depreciation methods of accounting for construction expenditures. In April 2016, the Brazilian bank Itau/Unibanco granted a US$ 23 million (BRL 80.6 million) loan to finance the Baixa do Feijao I power plant; US$ 21 million (BRL 73.6 million) to finance the Baixa do Feijao II power plant; US$ 22.7 million (BRL 79.5 million) to finance the Baixa do Feijao III power plant; and US$ 22 million (BRL 79.5 million) to finance the Baixa do Feijao IV power plant.