Santo Antonio do Jari Hydro Power Plant

active

In December 1997, the Brazilian company Jari Energetica S.A. was awarded the contract to build and operate a 373.4 MW hydro power plant located in the Jari River, states of Para and Amapa. Although the 30-year concession contract was only signed in February 2002, the project has suffered several delays and was only able to sell electricity in the regulated market in December 2010. The concession contract was restructured, and, as of January 2012, its expiration date was set for December 2044. In 2008, ECE Participacoes acquired a 90% stake in the project, and the sponsors created the company Amapa Energia to lead the project (10% of the shareholdings remained with Jari Energetica). In July 2011, when the Portuguese company EDP Energia do Brasil acquired ECE Participacoes and bought Jari Energetica´s participation in the project, the company name was changed to CEJA - Companhia Energetica do Jari S.A. In December 2010, the project company took part in a competitive bidding for the sale of electricity to the regulated market and won the bidding process by presenting a tariff of US$ 59.1/MWh (BRL 104/MWh), which was exactly the ceiling set by the regulatory agency. CEJA committed to sell 65% of the output to the regulated market (a 30-year power purchase agreement was signed) and the remaining 35% to the unregulated market, starting in January 2015. The sponsor committed to invest US$ 512.3 million (BRL 1 billion) in the project, which also includes a 20-km transmission line connecting the power plant to the grid. In December 2012, the sponsor was granted a US$ 377.5 million (BRL 736.8 million) loan from state-owned bank BNDES. The remaining cost was set to be financed with sponsor' internal resources. Environmental regulator, Ibama, awarded an environmental license for the project in June 2011. The project company signed an EPC contract with CESBE, Alstom and Areva Koblitz for the construction works, which were underway as of March 2012. 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. Commercial operations commenced in September 2014.