Salto Apiacas Hydro Power Plant

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In August 2013, the company Enel Brasil Participacoes S/A was awarded in a competitive bidding process the contract to build and operate a hydro power plant (45 MW) located at the Apiacas River, state of Mato Grosso. The names of other bidders were not disclosed. The bidding criteria set by the regulatory agency ANEEL was the lowest tariff. Enel Brasil presented the lowest offer, a value of US$ 51.1/MWh (BRL 120/MWh). The contract was signed in March 2014, and sponsors created the company Enel Green Power Salto Apiacas S.A. to lead the project during the 35-year contract period. Enel Green Power Salto Apiacas S.A. committed to sell 100% of the output to the regulated market .The company Constran Engenharia was hired to conduct the EPC works for the project and supply equipment. The sponsor committed to invest US$ 72.2 million (BRL 178.4 million) in the power plant. The sponsor announced initially that the project would be financed solely with equity, but a financing deal was approved in May 2016 in which the project was granted a 1-year bullet promissory notes of US$ 29.6 million provided by Banco Santander. Construction works commenced in March of 2014 and operations were expected to begin by 2017. 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.