Generators and funds bet on PCH
Valor Econômico - 07/18/2008
The figures of the Electric Energy National Agency (Aneel) on the potential for the generation of energy from Small Hydroelectric Plants (PCHs) in Brazil are clear. The equivalent to power plant of Rio Madeira, something nearly 3.7 thousand megawatts (MW), is to be produced in the country. In order to make such capacity reality it will be necessary to invest at least R$ 15 billion (US$ 9.38 billion), since each installed MW costs nearly R$ 4 million (US$ 2.5 million). For definition, a PCH has installed power of up to 30 MW and it floods an area of no more than 3 square kilometers. Deducting the transmission fee, right to tax incentives and lesser complexity in the environmental licensing processes, investing in PCH appeared in the radar of practically every major energy group in Brazil. That is the case, for example, of Tractebel, Energias do Brasil, AES Tietê, CPFL Energia, and others. But they were not the only ones. For a while the investment funds have also been interested in this segment. It is a growing interest because, in face of the current tight difference between offer and demand in Brazil, to become PCH reality is relatively fast. It takes between one and two years for it to get ready. "PCHs find room in the energy free market, which currently practices higher prices and longer contracts than the regulated one", states Hugo de Souza, Executive Officer of Enernova, an arm of the Energias do Brasil holding, owned by the Portuguese EDP group, for the business of generation from renewable sources. According to Souza, Enernova plans on adding 600 MW in PCHs between 2008 and 2012, which would result in an investment of R$ 2.4 billion (US$ 1.5 billion). The company currently has 13 small power plants, which amount 160 MW of capacity. Another group that strongly aims at the sector of PCHs is the AES Tietê. Controlled by the Brasiliana holding, whose shareholders are the BNDES (National Development Bank) (49.99%) and the American AES (50.01%), the company plans on investing R$ 260 million (US$ 162.5 million) to build 5 small power plants in Brazil. Two of them will be located in São Paulo, amounting to 8 MW, and the three other in Rio de Janeiro, totaling 52 MW.