Velcan Energy has signed 30-year concessions in Brazil to develop and operate two hydro plants with combined installed capacity of 74MW.
The France-based renewables producer is to develop the 14MW Rodeio Bonito and the 60MW Rio das Mortes schemes and bring them online in 2009 and 2010, respectively.
Construction work on Rodeio Bonito in Santa Catarina state is to commence in August this year. Annual revenues from the electricity output over 2009-2012 are forecast to increase from Euro1.8M in the first year of operations to Euro3.2M, almost double after four years. High income margins are expected with earnings before interest, taxes, depreciation and amortisation (EBITDA) seen at Euro1.5M and Euro3.2M in 2009 and 2012, respectively.
Work on the Rio das Mortes scheme – which consists of two 30MW projects, Pirapitinga and Ibituruna – is due to start in the second quarter of 2008. Two dams will be built for the projects some 3km apart in Minas Gerais state.
Revenues from the 60MW Rio das Mortes scheme is expected to be Euro15.9M in the first year (2010) with EBITDA of Euro13.9M, rising only a little to Euro16.5M with EBITDA of Euro14.4M by 2012.
Velcan set up its Brazilian unit less than two years ago and believes its recent success with the concessions will enable it to exceed its 200MW target for installed hydro capacity in the near future.
The company’s other development and operating unit is in India, where the first projects are biomass. In Brazil at this stage the focus for Velcan is hydro power.