Uniao dos Ventos Wind Farm

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Uniao dos Ventos Geradora Eolica S.A, a subsidiary of the Brazilian company Soares Penido Participacoes e Empreendimentos S/A (Grupo Serveng-Civilsan), was granted the authorization to build five wind power plants located in the state of Rio Grande do Norte, municipalities of Pedra Grande and Sao Miguel do Gostoso (113.4 MW in total capacity). The 35-year contracts were signed with the regulatory agency ANEEL starting in July 2014. The company created five special purpose companies to manage the projects: Forte Canto de Baixo Geradora Eolica S.A - Uniao dos Ventos 12 (25.2 MW) Ventos de Santo Antonio Geradora Eolica S.A - Uniao dos Ventos 13 (18.9 MW) Ventos do Canto de Baixo Geradora Eolica S.A. - Uniao dos Ventos 14 (21 MW) SM Geracao de Energia Eolica Ltda - Uniao dos Ventos 15 (25.2 MW) Ventos Parazinhenses Geradora Eolica S.A - Uniao dos Ventos 16 (23.1 MW) The total investment in the power plants was estimated at US$ 174 million (BRL 600 million). Construction works commenced in March 2016 and were in its final stages by June 2017. Detailed financing information was not available. The government periodically runs public bidding for the sale of energy to the country´s distribution companies. Uniao dos Ventos 12, 13, 14, 15 and 16 won the public bidding that took place in December 2013 by offering an average tariff of US$ 48.9/MWh (BRL 115/MWh). The project companies signed 20-year power purchase agreements with the several electricity distribution companies. 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.