• Norte Energia

Getting to know Norte Energia S.A.

The concession for building the hydroelectric dam complex in the municipality of Vitória do Xingu was the result of a public sale held on April 20, 2010. The sanction went to Norte Energia S.A. for a period of 35 years.

Norte Energia S.A., made up of state and private companies in the electrical, contracting, pension funds and investment sectors, as well as self-generating companies, will sign a contract for commercializing the electrical energy within a regulated environment, with the distribution concessionaires, at the sum of R$62 billion, relating to the supply of 795 million MWh.

In order to explore the hydroelectric potential, the concessionaire will give the Union the annual value of R$16.6 million as payment for the use of public property, as well as around R$200 million to be paid to the Union, to the State of Pará and the municipalities that are impacted with this endeavor, as financial compensation for the use of the hydro resources.

Estimated at beginning its operations on December 31, 2014 and commercializing its services by February 2015, Belo Monte will be the largest hydroelectric dam that is 100% Brazilian and the third largest in the world. Its construction should generate close to 20 thousand jobs during the peak of its construction.

The Belo Monte Hydroelectric Dam Complex will have an installed capacity of 11,233.1 MW of power and a previewed annual generation of 38,790,156 MWh or 4,571 MW on average with a 503 km2 reservoir. The completion of the project is estimated at 10 years and beginning operations of the last machine by January 31, 2019.

In order to foster compatibility between the energy interests and a sustainable environment, the flooded area has been cut down. The plant’s reservoir has been reduced in regards to the initial project and the flooded area reduced by 60%. While the national average of flooded areas for hydroelectric plants is 0.49 km2 per MW installed, Belo Monte will only impact 0.04 km2 per MW installed.

This endeavor will integrate the Accelerated Growth Program (Programa de Aceleração do Crescimento – PAC), which is a priority for the Federal Government. Putting it into effect will offer more energy and security to the National Interconnecting System (Sistema Inerligado Nacional – SIN), and will be able to take better advantage of the hydrological differences with floods and draught in the different regions of the country.

Norte Energia S.A. does not have any other tax exemptions other than those given to other plants or any other endeavor within the Accelerated Growth Program (Programa de Aceleração do Crescimento – PAC), or those located in the area covered by the Amazon Development Superintendency (Superintendência de Desenvolvimento da Amazônia – Sudam.)

Ibama granted the preliminary license to Belo Monte on February 1, 2010, under the conditions that they hold a public hearing, which they did with the participation of close to 5,000 people. According to its own title, this license requires the fulfillment of a series of conditions to be met within a stipulated time period. Likewise, in order to issue the Installation License, the socio-environmental plans must be detailed and appear in the Basic Environmental Project Report (Relatório do Projeto Básico Ambiental – PBA.)

In Belo Monte’s case, the proposed socio-environmental action in EIA/RIMA were consolidated in Plan (14), Program (54) and Project (86), covering the institutional and environmental management areas, as well as the physical, biotic and socio-economic environments. It is note-worthy to mention that a great number of the conditions reinforce or complement the group of proposed Plans, Programs and Project in the EIA/RIMA (Environmental Impact Assessment -Estudo de Impacto Ambiental / Environmental Impact Report -Relatório de Impacto Ambiental.)

The benefits of the Belo Monte project transcend the implantation of a source of renewable and economic energy to supply the needs of the State of Pará, the Northern Region and Brazil. An example of other hydroelectric advantages is the benefits associated to the environmental preservation of the hydrographical basin, not to mention the growing indicators of human development in the surrounding municipalities. This regional installation of the Belo Monte Hydroelectric Dam Complex will boost development in the region.

With the title payments alone for Financial Compensation for the use of Hydro Resources (Compensação Financeira pela Utilização de Recursos Hídricos – CFURH), better known as royalties, Norte Energia S.A. will contribute annually with close to R$160 million, with R$70 million directed to the State of Pará and the other R$88 million to the municipalities in the areas affected by the plant.

Furthermore, the Belo Monte Hydroelectric Dam Complex is within the Xingu Regional Sustainable Development Plan (Plano de Desenvolvimento Regional Sustentável do Xingu – PDRS Xingu), which is part of the Federal Government and State of Pará partnership, whose objective is to promote the sustainable development of the region focused on improving the quality of life for different social segments through a democratic, participative and territorialized management.

The participation of the Belo Monte Hydroelectric Dam Complex is associated with the Thematic Axle 2 – Infrastructure for Development/Energy, which, according to the Public Sale Editorial, Norte Energia will contribute close to R$500 million.