Bloomberg News

Chesf Brings First Wind Farms Online, Struggles With Connections

March 06, 2013

Cia. Hidro Eletrica do Sao Francisco, a unit of Brazil’s state-controlled power company Centrais Eletricas Brasileiras SA (ELET6), has started producing power from its first wind farms two months behind schedule.

One-third of the 90 megawatts of turbines at its Sao Pedro do Lago, Pedra Branca and Sete Gameleiras projects are operating and the rest will come online by the end of the month, according to Ruy Barbosa Pinto, superintendent of generation and construction projects at the Recife, Brazil-based company.

The company, which owns 49 percent of the projects, will have to make up for the undelivered electricity by buying power on the spot market after Siemens AG (SIE) furnished equipment linking the projects to the grid in February, seven months late, Pinto said by telephone today. Chesf, as the company is known, is also late connecting about 620 megawatts of other companies’ wind farms in the same region.

The spot price for electricity in the first three months of the year was “slightly higher” than the price at which Chesf had agreed to sell power from its projects.

The projects were due to start selling energy on Jan. 1, electricity trading board Camara de Comercializacao de Energia Eletrica said on its website. They sold power at 132.50 reais ($67.41) a megawatt-hour in a government-organized auction for new power capacity in 2010.

Brennand Energia SA owns the remaining 51 percent of the projects, Chesf said on its website.

Chesf failed to build grid connections for 26 wind farms in the northeast before a May deadline, Andre Pepitone da Nobrega, director of the country’s power regulator Agencia Nacional de Energia Eletrica, said Feb. 26. They are expected to be connected by the end of the year.

A spokeswoman for Siemens didn’t immediately answer inquiries by phone.

To contact the reporter on this story: Stephan Nielsen in Sao Paulo at snielsen8@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net


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