Brasventos Rio Grande do Norte Wind Farm

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The company Brasventos, a partnership of the Brazilian company J. Malucelli (51%) and the Brazilian state-owned companies Furnas (24.5%) and Eletrobras (24.5%), was granted authorizations to build three wind power plants located in the state of Rio Grande do Norte (165.7 MW in total capacity, municipalities of Galinhos e Macau). The partners established three companies to lead the projects: * Brasventos Eolo Geradora de Energia S.A. - EOL Rei dos Ventos 1 (48.6 MW) * Rei dos Ventos Geradora de Energia S.A. - EOL Rei dos Ventos 3 (48.6 MW) * Brasventos Miassaba 3 Geradora de Energia S.A. - EOL Miassaba 3 (68.5 MW) The sponsors also committed to build a 120-km transmission line connecting the power plants to the national grid, whose cost was estimated at US$ 15.4 million (BRL 30 million). The 35-year contracts were signed with the regulatory agency ANEEL starting in August 2010. The total investment in the power plants was estimated at US$ 362.8 million (BRL 708.2 million). In October 2012, the state-owned development bank BNDES approved the following loans (total of US$ 197.3 million or BRL 385.2 million): - EOL Rei dos Ventos 1: US$ 64.5 million (BRL 125.9 million) - EOL Rei dos Ventos 3: US$ 68 million (BRL 132.8 million) - EOL Miassaba 3: US$ 64.8 million (BRL 126.5 million). The remaining investment cost was set to be financed with the sponsor's own resources. The government periodically runs public bidding for the sale of energy to the country´s distribution companies. The three power plants controlled by Brasventos won the public bidding that took place in 2009, by offering an average tariff of US$ 76.5/MWh (BRL 153/MWh). The project companies signed 20-year power purchase agreements with the several electricity distribution companies , and the agreements included the annual adjustment of the tariff to the inflation rate. Brasventos committed to start supplying to the market in 2012, but, as of March 2013, construction works were still underway. 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. Finally, the electricity sold by the company is not subject to sectoral taxes. Commercial operations commenced in February 2014.