Morro Agudo Substation

active

In January 2015, CPFL Geracao de Energia S/A., a subsidiary of the Chinese company State Grid, was awarded the contract to build and operate the 1-km transmission line and the Morro Agudo substation, located at the state of Sao Paulo (500 kV in capacity). Besides CPFL, another bidder took part in the contest: Abengoa Construcao Brasil Ltda. The bidding criteria set by the regulatory agency ANEEL was the lowest required annual revenue. CPFL presented the lowest offer, a total value of US$ 3.2 million (BRL 10.836 million), 32.59% below the ceiling set by the regulatory agency. The contract was signed in March 2015, and the sponsors created the company CPFL Transmissao Morro Agudo S.A. to lead the project during the 30-year contract period. The sponsor committed to invest US$ 31.1 million (BRL 107.3 million) in the project. Construction works commenced in August 2016 and were in its final stages by June 2017. Financing information was not available. 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.