Jirau Power Plant

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In May 2008, Consorcio Energia Sustentavel do Brasil, which was formed by Suez Energy (50.1%), Eletrosul (20%), the state-owned company Chesf (20%) and Camargo Correa (9.9%), was awarded in a competitive bidding process the 35-year contract to build and operate a 3.3 GW hydro power plant located in the Madeira River, state of Amazonas. Besides Energia Sustentavel do Brasil, only one other consortium of companies, led by state-owned Furnas and Odebrecht, took part in the bidding contest. The bidding criteria set by the federal regulatory agency ANEEL was the lowest tariff. Energia Sustentavel do Brasil presented the lowest offer, a value of US$ 39/MWh (BRL 71.40/MWh), 21.6% below the ceiling set by the regulatory agency. The contract was signed in August 2008, and sponsors created the company Energia Sustentavel do Brasil to lead the project during the 35-year contract period. Energia Sustentavel do Brasil committed to sell 70% of the output to the regulated market and the remaining 30% to the unregulated market. Environmental regulator, Ibama, awarded an installation license to the concessionaire on 14 Nov 2008. Camargo Correa was set to conduct EPC works for the project. Alstom, Siemens, Vatech and Dongfang were contracted to supply equipment. The sponsors have signed 30-year power purchase agreements with a pool of power distribution companies. The sponsor committed to invest US$ 5.3 billion (BRL 10.5 billion) in the power plant. Financial closure was achieved in February 2009, when the sponsor was granted a US$ 3.6 billion (BRL 7.2 billion) loan from BNDES. About half of the loan granted by BNDES was comprised by the bank’s own funds, while the rest was syndicated from other financial institutions (Banco do Brasil, Caixa Economica Federal, Bradesco BBI, Unibanco e Banco do Nordeste do Brasil). The remaining cost was set to be financed with the sponsors’ internal resources. Construction works commenced in December 2009 and operations were expected to commence by 2012. As of July 2010, 22% of the works had been concluded. In September 2012, BNDES approved an additional financing package to the project amounting to US$ 1.2 billion (BRL 2.32 billion). Commercial operations commenced in September 2013.