Empresa Santos Dumont de Energia

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In May 2009, the Brazilian company ETEP, a subsidiary of Alupar (fomerly known as Alusa), was awarded in a competitive bidding process the contract to build and operate the Santos Dumont Substation located at the state of Minas Gerais. Besides ETEP, four other companies took part in the contest: ORTENG EQUIPAMENTOS E SISTEMAS LTDA.; the Brazilian consortium TRANSENERGIA (J.MALUCELLI, 25.5%; FURNAS, 49%; and DELTA 25.5%); the Spanish company ELECNOR TRANSMISSAO DE ENERGIA LTDA; and the Brazilian company ATP ENGENHARIA LTDA. The bidding criteria set by the regulatory agency ANEEL was the lowest required annual revenue. Alupar presented the lowest offer, a total value of US$ 4.2 million (BRL 8.3 million), 23.1% below the ceiling set by the regulatory agency. The contract was signed in November 2009, and the sponsor created the company Empresa Santos Dumont de Energia (ESDE) to lead the project during the 30-year contract period. The sponsor committed to invest US$ 44.6 million (BRL 89.3 million) in the transmission line. Enviromental clearence was awarded in April 2011. Construction works commenced in May 2011 and were concluded by January 2013. In November 2012, the state-owned bank BNDES granted a US$ 21.9 million (BRL 42.8 million) to finance the construction works. 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.