2nd transmission auction of 2023 ends with average discount of 40.85%

Chinese State Grid is the big winner of the second transmission auction Competition ended with a
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The second 2023 broadcast auction, held this Friday (15), at B3, in São Paulo, ended with an average discount of 40.85% after bid on the three scheduled lots, generating savings of R$ 1.57 billion per year for electrical energy consumers over 30 years of concession.

The highlight of the event was the Chinese State Grid which, through its subsidiary State Grid Brazil Holding (SGBH), won Lot 1, with the offer of RAP (Allowed Annual Revenue) of R$ 1.93 billion, which represented a discount of 39.90% on the maximum value.

The vice-president of SGBH, Ramon Haddad, said that the company presented a responsible and possible proposal, capable of guaranteeing the implementation and operation of the third system of HVDC from Brazil.

It is worth highlighting that Lot 1 has an investment of R$ 18.1 billion, 83% of the total volume that was tendered. “We are already checking everything that exists on the market so that State Grid Brazil can be successful in the funding of the projects,” said Haddad.

The implementation schedule for Lot 1 is 72 months, but Haddad said that the company is working to anticipate this deadline, without specifying the date.

The Chinese already have pre-contracts with suppliers and intend to work with a mixed solution, combining national and Chinese technologies. “We would not be able to participate if we were not sure that the project is viable from both a technical and economic point of view”, stated the executive.

The Olympus 16 Consortium (Alupar and Mercury Investment) took Lot 2 after offering a RAP of R$ 239.5 million, a discount of 47.01%. Celeo Redes won Lot 3 with a RAP of R$ 101.2 million, a discount of 42.39%.

In addition to these companies, Cymi Construções e Participações (which did not submit any bid), Eletronorte (which competed for lots 2 and 3) and the investment fund FIP Warehouse (lot 2) also participated in the event.

The second transmission auction bid for 4,471 thousand kilometers of lines and 9,840 MW in conversion capacity at substations. In total, R$ 21.7 billion in new investments are expected and the creation of approximately 37 thousand jobs.

The projects, distributed across the states of Goiás, Maranhão, Minas Gerais, São Paulo and Tocantins, will reinforce the electrical infrastructure for the flow of renewable energy from the Northeast to the Center-West and from the North to the Northeast.

O Minister of Mines and Energy, Alexandre Silveira, celebrated the result of the auction, reinforcing the importance of regulation to provide security to investors. According to him, every R$ 1 invested in transmission will unlock between R$ 3 and R$ 5 in investments in clean energy generation.

“We held the first auction in June this year and we are doing this second one. The next one is scheduled for March 2024. In total, we are talking about R$56 billion of investments in energy security, employment and income for millions of Brazilians”, highlights Silveira.

The general director of ANEEL (National Electric Energy Agency), Sandoval Feitosa, said that today was a day to celebrate, as another auction was held with great success.

He highlighted that in the past direct current lines were tendered to transport energy from large hydroelectric plants, but today this technology will be used to distribute energy from dozens of wind and solar plants in Northeast Brazil.

Ricardo Tili, director of ANEEL, said: “We were able to bid for all the lots at a very large discount, with a very high discount on the consumer tariff.”

Project construction deadlines vary from 60 to 72 months of work. The president of EPE (Energy Research Company), Thiago Prado, said that two more transmission auctions are scheduled for next year, one in March and the other in September.

Read too: ANEEL approves draft notice of the first transmission auction of 2024

See below the composition of each batch:

Lot 1

  • LT 500 kV Presidente Dutra – Graça Aranha C3, CS, with 18.2 km;
  • SE ±800 kVdc/500 kVac Graça Aranha;
  • SE ±800 kVdc/500 kVac Silvânia;
  • Sections of LT 500 kV between SE Graça Aranha and the sectioning of LT 500 kV Presidente Dutra – Teresina 2 C1, with 2 x 7.5 km;
  • Sections of LT 500 kV between SE Graça Aranha and the sectioning of LT 500 kV Presidente Dutra – Teresina 2 C2, with 2 x 6 km.
  • LT ±800 kVcc Graça Aranha – Silvânia, with 1,468 km
  • Synchronous Compensation 500 kV, 3x (-300/+300) Mvar, in SE Graça Aranha
  • Synchronous Compensation 500 kV, 3x (-300/+300) Mvar, in SE Silvânia
  • Investment: 18.1 billion

Lot 2

  • LT 500 kV Silvânia – Nova Ponte 3, C1 and C2, CD, with 330 km;
  • LT 500 kV Nova Ponte 3 – Ribeirão Preto, C1 and C2, CD, with 221 km.
  • Investment: 2.59 billion

Lot 3

  • LT 500 kV Marimbondo 2 – Campinas, C1, CS, with 388 km.
  • Investment: 1.02 billion

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Wagner Freire
Wagner Freire is a journalist graduated from FMU. He worked as a reporter for Jornal da Energia, Canal Energia and Agência Estado. He has covered the electricity sector since 2011. He has experience in covering events, such as energy auctions, conventions, lectures, fairs, congresses and seminars.

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