Sao Jose Hydro Power Plant

Active

Prospective

In December 2005, the Brazilian company Alupar Investimento was awarded in a competitive bidding process organized by the federal regulatory agency Aneel the 35-year contract to build and operate a 51-MW hydro power plant located in the Ijui River, state of Rio Grande do Sul. Besides Alupar, two other Brazilian companies took part in the bidding contest: Fuad Rassi and state-owned Eletrosul. The bidding criteria set by the federal regulatory agency ANEEL was the lowest tariff. The company also agreed to pay US$ 0.085 million (BRL 0.155 million) in yearly installments during the life of the contract, starting once operations commence (using a discount rate of 10%, the present value of this contribution was estimated at US$ 24 million). The contract was signed in July 2006, and sponsors created the company Ijui Energia to lead the project during the 35-year contract period. All the electricity produced was set to be sold to distribution companies. In September 2008, the state-owned investment fund FI-FGTS acquired 49.99% of the project company's shares. The sponsor committed to invest US$ 184.5 million (BRL 337.6 million) in the power plant. Financial closure was achieved in April 2008, when the sponsor was granted a US$ 91.9 million (BRL 168.2 million) loan from BNDES. The remaining cost was financed with the sponsors’ internal resources. Construction works started in September 2007, and operations commenced in March 2011.

Energy

Brazil

World Bank Group

Project

Commercial, Hydro, Power Generation (CCGT), Government