Modelo Wind Farm

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Enel Brasil Participacoes, a subsidiary of the Italian company Enel, was granted authorizations to build two wind power plants located in the state of Rio Grande do Norte (52.8 MW in total capacity, municipality of Joao Camara). Enel established two companies to lead the projects: * Enel Green Power Modelo I Eolica S.A. - EOL Modelo I (28.8 MW) * Enel Green Power Modelo II Eolica S.A. - EOL Modelo II (24 MW) The 35-year contracts were signed with the regulatory agency ANEEL starting in March 2012. The total investment in the power plants was estimated at US$ 91.7 million (BRL 215.9 million). The two power plants controlled by Enel won the public bidding for the sale of energy to the country´s distribution companies that took place in 2011, by offering an average tariff of US$ 50.5/MWh (BRL 98.53/MWh). The project companies signed 20-year power purchase agreements with the several electricity distribution companies , and the agreements included the annual adjustment of the tariff to the inflation rate. Enel committed to start supplying to the market in January 2014. As of March 2013, the environmental licenses had been issued, but construction works had not commenced. 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. Finally, the electricity sold by the company is not subject to sectoral taxes. In December 2011 , Enel applied for carbon credits for these power plants. Construction works commenced in May 2013 and were in advanced stages as of December 2013. Also in December 2013, the IFC approved a US$ 220 million A-loan to finance five of Enel's wind parks in Brazil: Modelo, Serra Azul, Fonte dos Ventos, Cristal and Curva dos Ventos. Information on how much of this funding was directed to each project was not released. Commercial operations commenced in October 2014.