SE Extremoz II

active

In December 2011, the Brazilian company Neoenergia S.A., was awarded in a competitive bidding process the contract to build and operate a substation located at the state of Rio Grande do Norte (SE Extremoz II, 230/69 kV-300 MVA). Two other companies took part in the contest: ALUPAR INVESTIMENTO S/A; and state-owned company CHESF. The bidding criteria set by the regulatory agency ANEEL was the lowest required annual revenue. Neoenergia presented the lowest offer, a total value of US$ 0.8 million (BRL 2.28 million), 43.53% below the ceiling set by the regulatory agency. The contract was signed in May 2012, and the sponsor presented the company Narandiba S.A. to lead the project during the 30-year contract period. The sponsor committed to invest US$ 8.3 million (BRL 24.66 million) in the SE Extremoz II. Environmental clearance was awarded in late 2012. Construction works were concluded in April 2015, and commercial operation commenced in July 2015. 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 accelated depreciation methods of accounting for construction expenditures.