The Brazilian Electricity Regulatory Agency (ANEEL) has published the results of the the “Leilão de Concessões não prorrogadas” public auction regarding the 380 MW Volta Grande, the 1,710 MW São Simão, the 408 MW Miranda and the 424 MW Jaguara hydropower plants. The four plants will be awarded under the framework of 30-year concessions and the Brazilian government received R$630bn (US$197.5m) in premiums from the lease of the facilities. 70% of the future power supply will be earmarked for the regulated market and the remaining for the non-regulated market. The rationale behind the tender was to lease the hydropower assets and to raise cash for the current fiscal adjustment package.
The ANEEL awarded a 30-year concession to Enel Brasil S.A. (Enel) for the 380 MW Volta Grande operating hydropower plant located on the Rio Grande river (states of Minas Gerais and São Paulo, Southeastern Brazil). Enel plans to invest about R$1.4bn (about US$445m) for the hydropower concession. According to the auction rules, Enel is scheduled to take over the facility in January 2018 and from this point, it will be operated by Enel’s renewable subsidiary Enel Green Power Brasil Participações Ltda. The plant was commissioned in 1974 and has an annual energy production of 2.02 TWh. With this new deal, Enel's hydropower capacity in Brazil increases up to 70 MW from the current 890 MW.
The Chinese company State Power Investment (Spic) Pacific closed out the São Simão (Parnaiba river) bail for R$7.1bn while Engie Brasil secured both the Jaguara (Grande river) and Miranda (Araguari river) plants for R$2.2bn and R$1.4bn respectively.
SPIC Pacific Energy is controlled by Pacific Hydro Brasil, an affiliate of China's state-owned State Power Investment Company (SPIC). The auction increases the Chinese presence in Brazil's energy sector. In a November 2015 similar hydroelectric concession auction, China Three Gorges (CTG) acquired the Jupia (1,551MW) and Ilha Solteira (3,444MW) hydropower plants.