Fontes Solar Farm

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The Italian Enel Green Power was granted the authorization to build two solar power plants located in the state of Pernambuco, municipality of Tacaratu (11 MW in total capacity). The 20 years contracts were signed with the Administration of Pernambuco starting in April 2015. The power plants are: UFV Fontes Solar I (5,5 MW) UFV Fontes Solar II (5,5 MW) The total investment in the power plants was estimated at US$ 18 million, financed with the sponsor's equity. Construction works commenced in February 2015 and were concluded by September of that year. In December 2013, Enel won the public bidding promoted by the state of Pernambuco for a 20-year power purchase agreement to provide electricity to that state commencing in April 2015. UFV Fontes Solar I and II won the public bidding by offering an average tariff of US$ 97/MWh (BRL 228/MWh). In September 2015, Enel connected the two solar power plants to its wind power plant Fontes dos Ventos (90 MW), creating the Fontes Complex, the first hybrid project in the country. 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.