A Anglo American signed a contract to purchase part of the energy generated by the wind farms being built by the group House of Winds in the Northeast. “The agreement, which has a term of 20 years starting in 2022, will be responsible for supplying around 30% of all the energy consumed by the mining company's plants in the country”, says Casa dos Ventos.
The agreement establishes an average of 95 MW of electricity. The largest volume in private contracts between large energy consumers and generators in Brazil, Casa dos Ventos states in a note.
“We are proud to announce the signing of the largest corporate renewable energy contract ever signed in the country: we will supply 95 MW of average energy from our Rio do Vento project to Brasil – Anglo American’s operations in the country. With this partnership, we ensure that the company reduces its energy costs, while reducing its carbon footprint and meeting its sustainability goals,” says Casa dos Ventos.
According to records of the ONS – National Electric System Operator, The Northeast region of Brazil reached the instantaneous generation of 10 thousand MW of wind energy in June 2020. The record until then was 9,755 MW, on November 12, 2019.
What are renewable energies?
A definition of what is considered renewable may vary for each company. Considering that a large part of the renewable electricity generated in Brazil comes from large hydroelectric plants, which require extensive transmission lines to transport energy and a large area of reservoirs, some corporations and developers use the term “renewable” to refer only to non-conventional renewable energies, such as wind, solar, biomass, solid waste and small hydropower.
What is PPA?
The PPA is an electricity contract, similar to a regular contract in the free market. These agreements are signed between the buyer and the project developer. Negotiated conditions include prices, volume, energy delivery period, guarantees/insurance, etc.
PPAs with corporate buyers often relate to new or expanding renewable energy projects. That is, undertakings that will be financed based on contract revenues. Given the requirements for financing large infrastructure projects, the general term of a PPA is 8 to 20 years.
Want to know more about PPA? Check out the guide Why is Corporate Purchasing of Renewable Energy a good deal? The paper provides an overview of the use of corporate renewable energy PPAs, focusing primarily on the opportunities they present for companies in Brazil.
