Santos Energia Wind Farm

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The company Santos Energia Participacoes, a partnership of the Spanish bank Santander (99.98%) and the Spanish companies Abengoa (0.01%) and Instalaciones Inabensa S.A. (0.01%), was granted authorizations to build three wind power plants located in the state of Ceara (73.6 MW in total capacity, municipalities of Trairi). The partners established three companies to lead the projects: * Central Eolica Sao Jorge S.A. - EOL Sao Jorge (27.6 MW) * Central Eolica Sao Cristovao S.A. - EOL Sao Cristovao (29.9 MW) * Central Eolica Santo Antonio de Padua S.A. - EOL Santo Antonio de Padua (16.1 MW) The 35-year contracts were signed with the regulatory agency ANEEL starting in July 2012. The total investment in the power plants was estimated at US$ 118 million (BRL 277.9 million). The three power plants controlled by Santos Energia won the public bidding for the sale of energy to the country´s distribution companies run by the government that took place in August 2011, by offering an average tariff of US$ 63.7/MWh (BRL 104/MWh). The project companies signed 20-year power purchase agreements with the several electricity distribution companies , and the agreements included the annual adjustment of the tariff to the inflation rate. Santos Energia committed to start supplying the market in 2014. As of March 2013, the environmental licenses had been issued, but construction works were not underway yet. The projects 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. Finally, the electricity sold by the company is not subject to sectoral taxes. In July 2012, the sponsor applied for carbon credits. Construction works commenced in July 2013, and were in its final stages by December 2013. Commercial operations were expected to begin in November 2014. In June 2014, the state-owned bank BNDES granted a US$ 82.4 million (BRL 193.9 million) loan to the project. Commercial operations commenced in November 2014.