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Brazil wind energy auction sells at $46.37 per MWh

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Brazil's first wind energy of the year contracted new generating capacity for an average price of 110.51 Brazilian reais ($46.37) per megawatt-hour.
 
At the auction, energy distributors agreed to buy about 1,500 megawatts of new generating capacity, set to come online by September 2015.
Projects with a total capacity of almost 9,000 megawatts had signed up to participate in the auction. Contracts are awarded to companies that offer to sell energy for the lowest price to the country's electricity distributors.
A total of 66 wind farms successfully bid for contracts to supply backup energy to Brazil's national electricity grid for a period of 20 years. According to the CCEE, the winning bidders will need to invest about BRL5.46 billion to build the wind farms.
This was the first wind energy auction that operated under stricter rules. To participate, companies had to have access to existing transmission networks. That was meant to avoid past instances when wind farms in Brazil were completed before the accompanying transmission networks, leading to wind-farm owners getting paid even though they were unable to transmit the generated power to consumers.
In order to ensure that the wind farms would be able to deliver the promised energy, the government also changed the way it calculates the generating capacity bidders can sell. In previous auctions, the bidders were allowed to offer energy for which they could assure generation 50% of the time, but for this round bidders had to guarantee that they could generate the contracted energy 90% of the time.




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