Bons Ventos Wind Farm Phase II

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The Brazilian Group Servtec, was granted the authorization to build five wind power plants located in the state of Ceara, municipalities of Ibiapina and Ubajara (86.1 MW in total capacity). The 35-year contracts were signed with the regulatory agency ANEEL starting in June 2014. The company created one special purpose company to manage the projects listed below: Geradora Eolica Bons Ventos da Serra 2 S.A. Bons Ventos Cacimbas 7 (16.8 MW) Bons Ventos Cacimbas 5 (21 MW) Bons Ventos Cacimbas 4 (10.5 MW) Bons Ventos Cacimbas 3 (14.7 MW) Bons Ventos Cacimbas 2 (23.1 MW) The total investment in the power plants was estimated at US$ 113.2 million (BRL 379.1 million). Financial closure was achieved in December 2016, when the sponsor was granted a US$ 65.4 million (BRL 225.5 million) loan from the Brazilian bank BNDES. Commercial operations are expected to begin by the end of 2017. The government periodically runs public bidding for the sale of energy to the country´s distribution companies. Geradora Eolica Bons Ventos da Serra 2 won the public bidding that took place in December 2013 by offering an average tariff of US$ 35.4/MWh (BRL 122/MWh). The project companies signed 20-year power purchase agreements with the several electricity distribution companies. 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 accelerated depreciation methods of accounting for construction expenditures.