Serra das Vacas Wind Farm

active

Eolica Serra das Vacas Holding, a partnershipe of the Brazilian companies PEC Energia (51%) and the state-owned Chesf (49%), announced the development of the Serra das Vacas Wind Farm in the municipality of Paranatama (state of Pernambuco). The project envisaged the construction of four power plants with 90.7 MW in total capacity managed by the following special purpose companies: EOL Serra das Vacas 1 (23.9 MW) - CGE Serra das Vacas 1 CGE Serra das Vacas 2 (22.3 MW) - CGE Serra das Vacas 1 CGE Serra das Vacas 3 (22.3 MW) - CGE Serra das Vacas 1 CGE Serra das Vacas 4 (22.3 MW) - CGE Serra das Vacas 1 Starting in May 2014, the four power plants were granted 35-year authorizations to develop the projects by the regulatory agency ANEEL. In November 2013, all project companies had been granted long-term power purchase agreements to provide electricity to the grid at a rate of US$ 52.3/MWh (BRL 122.9/MWh). The power plants committed to start supplying the market in January 2016. The total investment in the five power plants was estimated at BRL 492.2 million or US$ 147.5 million. In November 2015, the state-owned bank BNDES approved a US$ 80.8 million (BRL 269.4 million) loan to the project. The projects were 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, companies were allowed to use accelerated depreciation methods of accounting for construction expenditures. Finally, the electricity sold were not subject to sector taxes.