Companhia Transleste de Transmissão

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The Brazilian government, under the power regulator Aneel, awarded a greenfield build, own , and operate contract for a transmission line in Brazil’s eastern state of Minas Gerais. The project company, Companhia Transleste de Transmissão will transmit power through the concessional period of 30 years. The line will connect the areas of Montes Claros and Irape. The Transleste II project was one of 7 transmission concessions awarded by Aneel in 2003-2004; all lines cover 1,787 km and will include investment of US$614 million. Aneel was prompted to release the bids after Brazil's National Privatization Council (CND) issued a resolution in June 2003 calling for 7 groups of transmission concessions. The greenfield build, own, and operate contract was awarded by Aneel in November 2004. The contract was signed by the winning consortium comprising federal generator Furnas Centrais Electricas (Furnas - 24 percent), Companhia Energetica de Minas Gerais (Cemig - 25 percent), Alusa (41 percent), and Orteng Equipamentos e Sistemas (10 percent). The consortium paid US$3.74 million for the right to operate the line and the substations. The winning consortium was selected on the basis of offering the lowest transmission tariff. Total project financing of the US$40 million project was provided by the sponsors in November 2004 with support from BNDES. The Transleste II project was expected to start operations 18 months after the contract signing – approximately May 2006. When completed, the 150-km line will pass through the municipalities of Berilo, Virgem de Lapa, and Aracuai. Operations commenced in 2007.