Santa Fe Small Hydro Power Plant

active

In November 2001, the Brazilian company Espirito Santo Centrais Eletricas S.A. - ESCELSA, a subsidiary of Portuguese group EDP Energias de Portugal S.A, was granted the 30-year contract to build and operate the Santa Fe Small Hydro Power Plant (29 MW) located at the municipality of Alegre, state of Espirito Santo (Itapemirim River). The power plant was initially named PCH Santa Fe, but its name was changed to PCH Francisco Gros in December 2010. In June 2006, the company had been granted power purchase agreements to sell electricity to distribution companies starting in 2009. The company presented a winning bid of US$ 62.5/MWh (BRL 124.99/MWh). The investment committed to the power plant was estimated at US$ 80 million (BRL 160 million). Financial closure was achieved in February 2008, when the sponsor was granted a US$ 26.2 million (BRL 48 million) 7-year term loan from the Brazilian bank Banco do Brasil. In May 2009, the sponsor was granted an additional US$ 38 million (BRL 76 million) 14-years term loan from the Brazilian bank BNDES. Commercial operations commenced in July 2009. 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.