Santo Angelo Thermal Power Plant

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The Brazilian company Usina Santo Angelo Ltda was granted the authorization to build and operate a 40-MW sugar-cane residue fueled power plant located at the state Minas Gerais. The power plant was named UTE Santo Angelo. The 35-year contract was signed with the regulatory agency ANEEL in May 2012. The value of the investment committed to UTE Santo Angelo was estimated at US$ 23.4 million (BRL 55 million). UTE Santo Angelo won the public bidding that took place in December 2013 to sell electricity to several distribution companies, by offering a tariff of US$ 57.5/MWh (BRL 135.4/MWh). The project company signed 15-year power purchase agreements with the several electricity distribution companies. UTE Santo Angelo committed to start supplying to the market in 2018. In December 2013, commercial operations 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 accelerated depreciation methods of accounting for construction expenditures. Finally, the electricity sold by the company was free from sectoral taxes.