10/24/2008 09h38
AES, Duke and the São Paulo government near an agreement
Valor Econômico 10/24/2008
The government of the State of São Paulo will not allow that the AES Tietê and Duke Energy Geração Paranapanema's expansion of 15% of their generating parks - as foreseen in the concession agreements signed at the time of the privatization -, with the division of Cesp, are not made inside the State. This will mean investments around R$ 2 billion (US$ 909.1 million) by the two companies to install a generation capacity of 772 megawatts. Already late to meet the deadlines, the companies have started structuring alternative projects. AES Tietê is going to co-generate energy from sugarcane bagasse and is building two small hydroelectric central plants. Secretary of Energy of São, Paulo Dilma Pena, said that the government will not allow that the investments are not made in the State, but that there is an ongoing negotiation with the objective of postponing the deadlines to meet that obligation. Commercialization director of the AES group in Brazil, Ricardo Cunha, is confident in a solution and says that, at this moment, the way the ratification of the new projects will be made is being studied. It will be necessary to adjust details such as the necessary percentages of investment in co-generation projects and also to define the calculation formula for the guaranteed energy. Today the company has projects in advanced negotiations with sugarcane plants to install 60MW. Tietê is asking for the deadline of one year, by 2009, for the survey of all projects capable of being implanted to be done. From then on a final date for the delivery of energy would be set. Cunha does not rule out the possibility of building natural-gas thermoelectric plants, as long as the gas ducts that are being installed in the State are ready, which would lead to a final deadline for 2013. The privatization public bid foresaw the expansion of 15% of the generating park or the purchase of energy, equivalent to those15%, as long as from new projects built in the State, in contracts of at least five years of duration. The expansion would have to be done in eight years. Many problems were indicated by the companies in this period. The discussion was taken to Aneel, which, at the end of August, decided that it was outside its competence to inspect AES Tietê's and Duke Energy's contracts, since they were signed with the government of the State. And it is on that legal opinion that the PGE has been working.
