Santa Carolina Small Hydro Power Plant

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The Brazilian company Carolina Geracao de Energia Ltda, a partnership of CRERAL - Cooperativa de Geracao de Energia e Desenvolvimento (30%) and Grupo Arbaza (70%), was granted the authorization to build a 10.5-MW small hydro power plant located in the municipalities of Andre Rocha and Muitos Capoes, state of Rio Grande do Sul. The power plant was named PCH Santa Carolina. In January 2012, the company signed a 30-year contract with the regulatory agency ANEEL allowing the company to build and operate the power plant. In August 2015, the company took part in a bidding process to establish 30-year power purchase agreements with electricity distribution companies. The company won the contracts by offering the tariff of US$ 68.2/MWh (BRL 203/MWh). The company agreed to commence operations in 2018. The investment was estimated at US$ 14.1 million (BRL 42 million). Construction works commenced in July 2013. As of June 2015, the construction works were in advanced stage. 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. In 2011, the company applied for carbon credits.