Jatai Thermal Power Plant

active

The Brazilian group Cosan's subsidiary Cosan Centroeste S.A. was granted the authorization to build and operate a 105-MW sugar-cane-residue fueled power plants located in the state Goias. The power plant was named UTE Jatai. The 35-year contract was signed with the regulatory agency ANEEL in February 2009. The value of the investment committed to UTE Jatai was estimated at US$ 179.1 million (BRL 327.8 million). UTE Jatai won the public bidding that took place in August 2008 to sell electricity to several distribution companies, by offering a tariff of US$ 32.8/MWh (BRL 60/MWh). The project company signed 15-year power purchase agreements with the several electricity distribution companies. UTE Jatai committed to start supplying to the market in 2011, but commercial operations commenced only in February 2013. 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. Finally, the electricity sold by the company was free from sectoral taxes.