Pedras Altas power station

From Global Energy Monitor

[português]

Pedras Altas power station, known locally as UTE Ouro Negro, is a proposed 600-megawatt (MW) coal-fired power plant in Pedras Altas, Rio Grande do Sul, Brazil.

Location

The map below shows Pedras Altas, the approximate location where the plant would be built.

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Background

In September 2015, José Ivo Sartori, governor of Rio Grande do Sul state, confirmed that Ouro Negro Energia will invest US$3.5 billion to develop a two-unit, 600 MW coal-fired power plant near Pedras Altas, RS. According to Mr. Sartori, Ouro Negro Energia plans to complete construction in 2020 and begin commercial operations in 2021, with coal to be supplied by CRM (Companhia Riograndense de Mineração), a mining company based in Rio Grande do Sul state.[1] Coal for the project would come from the Candiota mine, Brazil's largest coal mine.[2]

Ouro Negro Energia's director, Silvio Marques Dias Neto, told the Jornal do Comércio that his company would submit an environmental permit request to Brazil's national environmental agency IBAMA in the first week of October and hoped to submit a bid on behalf of the Pedras Altas plant in Brazil's next national energy auction, scheduled for 2016. If successful at auction, Ouro Negro Energia would begin constructing the plant immediately. The company's long-range plans call for the plant to increase in size from 600 MW to 1800 MW.[3]

As of December 2015, Chinese state-owned SEPCO Electric Power Construction Corporation and Hebi Guochang Energy Development were reportedly in negotiations with Silvio Marques Dias Neto to build the plant. The Chinese companies would control plant operation, with two-thirds of the share capital and 80 percent of constructions costs guaranteed by the China Development Bank. The project has been approved by the Brazilian National Electric Energy Agency (Aneel), but needs environmental approval to compete for tenders launched by the government to hire plant constructors.[4]

After initially including the project in an auction in April 2016, the government delayed bidding due to recessionary conditions that resulted in a surplus of energy. Paradoxically, climate change was touted as a reason for pursuing coal-fired power, due to climate-induced changes in rainfall that have led to skepticism about the reliability of hydroelectric energy.[2]

In August 2016, Brazil's national environmental ministry IBAMA issued an advance license for the project, clearing the way for Ouro Negro Energia to enter the Pedras Altas plant in Brazil's next national energy auction, scheduled for the first half of 2017.[5]

The Pedras Altas project was officially registered to compete in Brazil's A-6 energy auction on December 20, 2017[6]; however, the company pulled out at the last minute citing unfavorable economic conditions[7], and the auction concluded with no contracts issued to coal plants[8]. Silvio Marques Dias Neto, president of Ouro Negro Energia S.A., expressed hope that Brazil's economy would pick up in 2018, when a new energy auction is anticipated in May or June.[7]

In April 2018, the director of Pedras Altas announced his intention to include the project in the A-6 energy auction to be held in August 2018[9]; however, Ouro Negro Energia did not ultimately participate in the auction.[10]

In March 2019, Ouro Negro's President announced that it would participate in the June 2019 A-4 energy auction.[11] In September 2019, Ouro Negro contracted Chinese company Sepco1 to build the plant for US $ 970 million.[12] The Ouro Negro plant was listed as a participant in Brazil's October 2019 A-6 energy auction but did not enter into any purchasing agreements.[13] Low energy demand created unfavorable conditions for Ouro Negro in the October auction, which awarded contracts to a mix of solar, wind, hydroelectric, natural gas, and biomass projects.[14][15]

As of January 2020, according to an article in Jornal do Comércio, Brazilian Coal Federation president Fernando Zancan remained hopeful that the Ouro Negro plant could compete successfully in a future Brazilian energy auction.[16] However, all of Brazil's 2020 energy auctions were subsequently postponed until 2021 due to the coronavirus pandemic.[17][18][19]

Financing

In 2019, it was announced that the project was "estimated at more than R $4 billion."[14] Eighty percent of the work would be "financed by Indico Financial Management & Services" and 20% with investors' equity, specifically, Power China Sepco 1 and the Ouro Negro Investment Fund (FIP).[11][20]

Project Details

  • Sponsor: Ouro Negro Energia S.A.[16]
  • Parent company: Ouro Negro Energia S.A.[16]
  • Location: Pedras Altas, Rio Grande do Sul, Brazil
  • Coordinates: -31.732865, -53.585750 (approximate)
  • Status: Permitted
  • Gross Capacity: 600 MW[9]
    • Unit 1: 300 MW
    • Unit 2: 300 MW
  • Type:
  • Projected in service:
    • Unit 1: 2026
    • Unit 2: 2026
  • Coal Type:
  • Coal Source:
  • Source of financing: US$568,061,283 in debt from Indico Financial Management & Services; US$142,015,321 in equity from Power China Sepco 1 and the Ouro Negro Investment Fund.[11][14][20]

Articles and resources

References

  1. "Pedras Altas terá investimento de R$ 3,5 bilhões em nova termelétrica". Portal do Estado do Rio Grande do Sul. 2015-09-29.
  2. 2.0 2.1 "Brazil adds new coal-fired power," Dialógo China, 26 September 2016
  3. "Usina em Pedras Altas pode crescer,", Jornal do Comércio, September 30, 2015.
  4. "Chinese state-owned enterprises want to build power plant in Brazil," Macau Hub, Dec 14, 2015
  5. "Ibama emite Licença Prévia da UTE Ouro Negro," Tribuna do Pampa, August 7, 2016
  6. "UTE Ouro Negro está habilitada para o leilão A-6, que acontece em dezembro," Tribuna do Pampa, September 19, 2017
  7. 7.0 7.1 "Economia em baixa frustra participação de UTE Ouro Negro," Tribuna do Pampa, December 22, 2017
  8. "Leilão A-6 viabiliza 3,8 GW e R$ 13,9 bilhões em novos investimentos," CanalEnergia, December 20, 2017
  9. 9.0 9.1 UTE Ouro Negro pode participar de novo leilão de energia, Jornal Minuano, Apr. 3, 2018
  10. "LEILÃO A-6 2018 - RESULTADOS". ePowerBay. 2018-09-04.
  11. 11.0 11.1 11.2 UTE Ouro Negro to participate in new energy auctions announced by the federal government, Jornal Minuano, Mar. 13, 2019
  12. UTE Ouro Negro signs billionaire contract with China's Sepco1 and prepares to sell energy in free market, Pampa Tribuna, Sep. 28, 2019
  13. Minas e Energia quer viabilizar financiamento do BNDES para usinas a carvão, epbr, Oct. 18, 2019
  14. 14.0 14.1 14.2 "UTE Ouro Negro não colocou energia à venda no leilão A-6". Jornal Tribuna do Pampa. October 18, 2019.
  15. "Resultados do Leilão A-6 de 2019". ePowerBay. 2019-10-18.
  16. 16.0 16.1 16.2 "ABCM prevê programa para carvão em 2020". Jornal do Comércio. January 13, 2020.
  17. "MME posterga realização dos leilões de energia elétrica e de transmissão". EPE (Empresa de Pesquisa Energética). March 30, 2020.
  18. Sánchez Molina, Pilar (April 1, 2020). "Brazil postpones energy auctions". PV magazine.
  19. "Leilões de energia representam oportunidades para o setor". UNICA. December 9, 2020.
  20. 20.0 20.1 "RS disputa leilão de geração A-6 com 73 projetos de energia eólica (939,7 MW) e duas termelétricas a carvão (940 MW) | Revista Modal". Revista Modal. October 13, 2019.

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