A group of businesses led by French utility SUEZ Energy International (SZE.PA) won the right to build a massive hydroelectric dam in Brazil.
The damn will be the largest infrastructure project in the country and will provide 3,300 megawatts (MW) of electricity to assist in meeting the country’s growing demand for energy, projected at about 4,500 MW per year.
The Consortium Energia Sustentável do Brasil, which is made up of SUEZ Energy International (50.1%), Eletrosul (20%), Chesf (20%) and Camargo Correa (9.9%) won the right to build the dam with a bid of 71.4 BRL (i.e. 27.5 Euros) per MWh to sign a 30-year agreement with electric power distributors.
This price, which is roughly 45% below market value according to a Reuters report, represents a guaranteed turnover of 9.6 billion Euros over 30 years, starting in 2013.
70% of the electricity to be produced by the plant was pre-sold to electric power distributors through the auction. The remaining will be sold on the free market.
The total investment in the 3,300 MW plant will be about 3.3 billion Euros, according to a Suez release. Project finance is committed by the Brazilian development bank BNDES up to 85% of the investment.
Dirk Beeuwsaert, CEO of SUEZ Energy International, said, “We have a long and extensive experience in developing and building new projects in Brazil and are committed to participate to the growth of the Brazilian energy sector. Tractebel Energia, our operational company in Brazil, holds 6.4% of the power generation market of Brazil. Our target is to expand our participation by means of profitable projects with high level of sustainability. The Jirau plant will considerably contribute to secure the energy supply of Brazil, its economic growth and development in the coming years “
Jirau is located on the Rio Madeira, in the State of Rondônia, in the North of Brazil. It is the second project from the Rio Madeira complex to be auctioned and it is one of the projects listed in the long-term planning of the Brazilian government for the development of the power sector. Jirau is a run of the river plant with a 258 km² reservoir, 135 km² of which is the original river bed.
The CEO of SUEZ Energy Brasil, Maurício Bähr said, “With Jirau, the company will have three hydroelectric plants under construction. São Salvador (243 MW), Estreito (1,087 MW) and Jirau (3,300 MW) will provide Brazil with 4,630 MW of new energy.”
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