HRW Briefings

SMC, K-Water announce joint venture to build 246 MW Angat in the Philippines

According to filings with the Philippine Stock Exchange, the Korean Water Resources Corporation (K-Water) and Filipino conglomerate San Miguel Corporation (SMC) announced a joint venture in August for development and operation of the 246 MW Angat project.

SMC — a food, beverage and packaging company in southeast Asia — has expanded into energy and infrastructure markets in recent years. The company said its involvement with the Angat plant will be handled by a newly created unit.

The project will add hydropower generation capabilities to the existing Angat Dam, in Bulacan Province. The dam is owned by the Philippine government and provides water for metropolitan Manila and neighboring provinces.

K-Water was declared highest bidder for development of the Angat project in 2010 after offering US$440.88 million. However, the country’s Supreme Court required that the South Korean company find a Filipino partner before allowing work at Angat to begin.

Two Chinese plants begin commercial operation

The 13,860 MW Xiluodu hydropower plant in China was connected to the country’s power grid in July following a three-day test run, Hong Kong’s Ministry of Foreign Affairs said.

Work on the plant began in 2003. Xiluodu will ultimately house 18 turbine-generator units, although only 13 have been installed thus far. The Xiluodu project, located on the Jinsha River in the central Sichuan Province, will be the world’s third-largest hydropower plant after China’s Three Gorges and Brazil’s Itaipu when fully completed in 2015.

In China, the 13,860 MW Xiluodu hydropower project
In China, the 13,860 MW Xiluodu hydropower project was connected to the country’s power grid. Thirteen of the total 18 turbine-generator units have been installed in the powerhouse.

In addition, all four units at China’s 6,400 MW Xiangjiaba plant on the Jinshajiang River in the Yunnan Province are now in commercial operation, the manufacturer reports.

Each of the generating units was designed and built in Alstom’s factory in Tianjin, China, one unit every two months. The first unit went into commercial operation in November 2012, with more coming on line through July.

Each of four Francis turbines is coupled to an 889 MVA generator. Alstom said the generators are the only air-cooled generators in the world with 23 kV windings.

Each turbine runner measures almost 10 meters in diameter and weighs more than 400 tonnes, making them among the largest in the world, Alstom said. China Three Gorges Corporation awarded the contract in 2008.

Union Energy acquires developer Generacion Andina

Union Energy Group — formed in 2011 to invest in, develop, build and operate power generation projects in Latin America — has acquired hydro project owner Generacion Andina as part of its expansion into Peru.

Generaction Andina was previously held by Germany’s Energie Baden-Wurttemberg and owns six hydro plants with a total installed capacity of 55.2 MW. Two projects are operating with a 20-year, government-backed power purchase agreement in place, while four others are in various stages of development, Combined, Union Energy said the portfolio will represent a total investment of US$145 million.

The next two hydro projects to be constructed are 8.4 MW El Carmen and 19 MW 8 de Agosto. Generacion Andina awarded a $77.9 million contract to Spainish company Sacyr for their construction earlier this year.

The acquisition adds to Union Energy Group’s existing 1 GW development portfolio in Peru.

World Bank to finance 80 MW Rusumo Falls plant

The World Bank’s Board of Executive Directors approved US$340 million in financing in August for the 80 MW Rusumo Falls hydropower plant.

Located along the Kagera River between Rwanda and Tanzania, it is intended to “reduce electricity costs, promote renewable power, spur job-led economic development and pave the way for more dynamic regional cooperation, peace and stability,” the World Bank said.

The run-of-river project will provide power for Burundi, Rwanda and Tanzania — each of which will receive a third of the World Bank’s funding.

“The Rusumo Falls hydroelectric project takes a regional approach to tackling sub-Saharan Africa’s power crisis, providing low-cost, clean, renewable energy,” said Jamal Saghir, Director for Sustainable Development in the Africa Region.

Saghir added: “The new power plant signals the bank’s commitment to keeping the lights on across the African continent, necessary for achieving growth, ending poverty and boosting shared prosperity in the region.”

Statistics provided by the World Bank show that only around 4% of Burundi’s population has access to electricity, while Rwanda and Tanzania have electrification rates listed at 13% and 15%, respectively.

Work moves forward on El Chaparral in El Salvador

Comision Ejecutiva Hidroelectrica del Rio Lempa (CEL) is moving forward on development of the 65.8 MW El Chaparral project in El Salvador by pre-qualifying construction companies.

The project originally was to be built by Astaldi S.p.A. of Italy under a US$220 million contract awarded in October 2008. However, the two companies terminated the contract in 2012 by mutual consent because it did not provide for redesign of the project, which was necessary as a result of landslides from 2010 Tropical Storm Agatha and the discovery of geological instability in a portion of the project site.

El Chaparral is to include a roller-compacted-concrete dam, reservoir, powerhouse containing two 32.2 MW units and a 1.42 MW minimum flow unit, and a substation just upstream of the Torola River’s confluence with the San Juan River.

Two hydro plants under development in Nepal

The final section of tunnel intended to bring water to the Kulekhani 3 plant’s powerhouse has been completed, marking the end of a five-year construction process.

China’s Sinohydro Corporation began construction of the 4,221 meter-long main tunnel in July 2008, alongside four 1,900 meter-long adit tunnels. Project officials said the 14 MW plant is about 66% complete and should be finished by September 2014.

Kulekhani 3 is one of a string of hydroelectric plants along Nepal’s Kulekhani River. Also included are the Kulekhani 1 and Kulekhani 2 plants.

In related news, renewable energy developer Spark Hydro Electric Company Ltd. is set to begin construction of the 101 MW Tamor-Mewa project, in the Koshi River Basin, in November. This cascade-type project consists of 83 MW Tamor and 18 MW Mewa powerhouses. The US$186 million run-of-river project will be located in Nepal’s eastern Tapeljung District, with a connection to the country’s grid coming via a new substation in Fungling.

The bulk of the funding for the project is expected to come from Nepalese and European investors, although the developers said a 10% share has been set aside for local investors.

Equipment supply contracts awarded for Turkey’s 636 MW Upper Kelekoy

Voith Hydro has received an order worth about US$40 million to supply equipment for the 636 MW Upper Kelekoy project on Turkey’s Murat River.

The company will provide three 202 MW Francis hydro turbines and associated equipment for the Upper Kelekoy (also spelled “Kalekoy”) project. This facility is being developed by Kalehan Enerji, a joint venture between Cengiz and Ozaltin.

The project forms part of a cascade comprised of four plants and Voith Hydro is also supplying equipment for the 560 MW Beyhan 1, which is located downstream.

The company said Turkey represents a “highly promising hydropower market,” with an estimated cumulative capacity of 40,000 MW still to be developed and nearly 50 new hydroelectric plants installed through the first half of 2013.

In a related development, Alstom announced that it secured a contract in July to supply one 30.6 MW vertical Francis turbine, switchyard equipment, transformers and control systems for this project.

Project operator files complaint over Swedish taxation

European utility Fortum has filed a complaint with the European Commission, claiming that the Swedish government is unfairly applying a selective tax on hydroelectric power.

According to Fortum, Sweden is planning to increase the real estate tax for hydropower projects based on their production volumes, with the tax on the market price of hydroelectricity increasing 25 to 30%. In Fortum’s case, that could translate to an estimated US$52.6 million in taxes per year.

“Energy taxation should conform with the Energy Taxation Directive, according to which electricity is to be taxed at consumption — not at production,” Fortum’s Head of Tax Reijo Salo said. “Furthermore, energy taxation should be transparent so that consumers can see how energy is taxed. In Sweden, this is not the case.”

Trangslet is one of many Fortum plants
Trangslet is one of many Fortum plants that may be affected if the government increases the real estate tax for hydro projects. (photo courtesy Fortum Corporation)

Fortum claims the tax is selective, as the hydropower sector is the only form of carbon dioxide-free production being targeted, making it an “indirect state subsidy to production based on fossil fuels and in clear conflict with the Swedish government’s climate and energy goals.”

The company’s complaint asks whether the increased real estate tax on hydropower can be based on production values as it is now, considering the EU’s regulations on excise duty. The complaint also asks the Commission to determine whether taxes targeting specific production forms are to be considered as indirect state subsidies to other production forms.

The European Commission is investigating.

Two projects moving forward in Uganda

Construction of the 188 MW Isimba Falls project on the Nile River in Uganda is now set to go ahead after the governments of Uganda and China signed a memorandum of understanding.

The agreement will see the China International Water & Electric Corporation develop the project using US$500 million in financing provided by the Export-Import Bank of China. Construction on the project is expected to begin in September, with work expected to last 34 months.

In other news, Uganda has received a US$500 million credit from China that will allow for construction of the 600 MW Karuma project on the Victoria Nile River, it has been reported.

Construction of the $2 billion hydro plant was supposed to have begun by the end of this year before the project stalled due to a lack of funds. Uganda said China’s investment will be added to $700 million in established government co-financing, with the remainder of the money to be raised from as yet unnamed development agencies.

China’s Sinohydro Group Ltd. received a contract to build this plant in June 2013 and Karuma is expected to begin producing power by 2018.

Iberdrola plans expansion of 32 MW San Pedro plant

Spanish utility Iberdrola has begun construction of a US$66.7 million extension project that will add 25 MW of installed capacity to the San Pedro hydroelectric plant.

San Pedro is located on the Sil River in northwest Spain and has an installed capacity of 32 MW. The company said the expansion project will take three years to complete, creating nearly 200 direct jobs.

Iberdrola’s decision to extend the complex comes months after a similar project was completed at the 441 MW Santo Estevo hydropower plant, which is located downriver from San Pedro.

Once complete, Iberdrola said, the company will have “fulfilled the objectives these extension projects set to achieve: sluice control, balancing flows downstream and optimizing exploitation of indigenous, renewable energy.”

IDB funds studies for 1,890 MW Salto Grande plant

Financing from the Inter-American Development Bank (IDB) will allow Comision Tecnica Mixta Salto Grande (CTM) to study areas of potential improvements and modernization at the 1,890 MW Salto Grande hydroelectric plant.

CTM — a public bi-national entity of Uruguay and Argentina — will also use IDB’s US$1.36 million in financing to explore options in additional generation capacity and efficiency upgrades.

Salto Grande has been generating power on the Uruguay River along the Argentina/Uruguay border since 1989, and IDB said “most of the equipment is reaching the end of its life cycle and requires replacement.”

The CTM study will not only examine Salto Grande’s 14 hydro turbines of 135 MW each, but also the plant’s four substations and transmission lines.

Hydro Tasmania CEO leaves utility

Hydro Tasmania Chief Executive Officer Roy Adair has stepped down from the Australian utility and hydro project operator. Australian sources report that Adair, who has a year left on his contract with the state-owned utility, was told he would not be offered a second term and decided to leave early as a result.

“The time was right for a change to take the business through its next phase and to provide long-term stability to the organization,” Hydro Tasmania stated in a release.

Still, company officials said Adair was able to accomplish much during his tenure. “In his three years at the helm of Hydro Tasmania, Roy has led the business to record levels of profit and raised the level of performance such that it is well placed to deal with the many challenges ahead,” board chairman David Crean said. According to Crean, Hydro Tasmania had a profits of more than US$92 million the past two years under Adair and looks to double its revenue this year.

“I wish the business and its entire staff a very successful and prosperous future,” Adair said.

The board of Hydro Tasmania has named Chief Commercial Officer Stephen Davy as acting CEO until a permanent replacement is selected. The utility said the process could take up to two months to complete.

Hydro Tasmania's Rowallan Dam,
Hydro Tasmania’s Rowallan Dam, which impounds water for a 10.5 MW hydro project, is being upgraded to increase its flood capacity, as part of the company’s rolling 10-year asset management plan.

Report shows cause for Vietnam dam collapse

Findings have been released from an investigation by the Central Highland Gia Lai Province into a dam collapse at Vietnam’s 5.5 MW Krel 2 project. The dam, a US$6 million project completed in 2010, collapsed in mid-June, damaged factories and flooded hundreds of acres of farmland.

The investigation revealed the dam was not constructed in accordance with its approved design, which called for the inside of the structure to have been covered by a 20 cm-thick layer of cement. Instead, much of the inside face was built with soil, leaving the dam much weaker than planned.

Province officials are reported to have told the project’s developer, Bao Long-Gia Lai Hydro-Electricity-Industry Company, to completely rebuild the dam weeks before its failure, although the dam was impounding about 5 million cubic meters of water when it collapsed.

The company will be fined and expected to compensate for damaged property.

Modernization of 3,444 MW Ilha Solteira project nearing completion

Voith Hydro says it has begun the final stages in the modernization of the 3,444 MW Ilha Solteira hydropower project.

The project, owned by Companhia Energetica de Sao Paulo (CESP), is on the Parana River in Brazil’s Sao Paulo state. The upgrades will give Ilha Solteira more flexibility in supplying reactive power to Brazil’s electrical grid, Voith Hydro said.

As part of the modernization project, Voith Hydro serviced four of the plant’s 20 generators, supplied new windings, stator cores, pole coils and one new stator frame, as well as renovating the other three existing frames. The company also renovated rotor poles and supplied a partial discharge detection system.

Court allows Cemig to retain control of 424 MW Jaguara plant

An injunction granted in June by Brazil’s Superior Court of Justice will allow utility company Companhia Energetica de Minas Gerais (Cemig) to maintain control of the 424 MW Jaguara hydroelectric plant.

Cemig said in a statement that its operating concession for the Jaguara facility was revoked by the Brazilian government after the company refused to agree with controversial energy sector reforms enacted by President Dilma Rousseff earlier this year. In an effort to lower consumer costs, Rousseff’s plan would require Cemig to agree to a revised concession with decreased revenue.

The court’s ruling will stand, pending a court review of the plant’s legal status, according to Cemig.

Two other Cemig-operated plants — the 1.7 GW Sao Simao and 408 MW Miranda hydropower plants — also have not yet had their concessions renewed. In the electric energy sector, Cemig services 96% of the concession area in Minas Gerais and has more than 7 million consumers in 774 municipalities. It is responsible for the operation of 65 power plants with total installed capacity of 6,925 MW.

India report: Rains disrupt hydro, while ADB adds to investments

Silt, debris and high waters created by one of the heaviest monsoons in India’s history halted operations at a number of hydroelectric projects in the northern part of the country in June, sources have reported.

According to India’s meteorological department, areas in Himachal Pradesh and Uttarakhand states received as much as 440% their normal rainfall, severely affecting the power supply in a region heavily dependent on hydropower.

The powerhouse at the 280 MW Dhauliganga plant was under water in mid-June, sources reported, while silt caused disruptions at the 1,500 MW Nathpa Jhakri, 400 MW Koteshwar and 1,000 MW Karcham Wangtoo hydropower projects.

In other news, the government of Uttarakhand signed a US$150 million loan agreement with the Asian Development Bank (ADB) in June, intended to help fund hydropower projects in the Indian state.

The ADB loan is the fourth tranche of the Uttarakhand Power Sector Investment Programme, which will ultimately add as much as 2,500 MW of hydroelectric power to India’s grid.

The loan has a 25 year financing term, including a grace period of five years, commitment charges of 0.15% and an interest rate to be determined in accordance with ADB’s London Interbank Offered Rate (LIBOR)-based lending facility.

Contract awarded for rehab work at Poland’s 160.2 MW Wloclawek

Polish water manager Regionalny Zarzad Gospodarki Wodnej Warszawie (RGZW) has awarded a US$17.5 million contract to Przedsiebiorstwo Robot Inzynieryjnych POL-AQUA SA for rehabilitation and repair of the 160.2 MW Wloclawek Dam on Poland’s Vistula River.

The 160.2 MW Wloclawek project in Poland
The 160.2 MW Wloclawek project in Poland is undergoing rehabilitation and repair work that includes improvements to the density of the dam’s body and face and development of an automatic measurement and control system.

The work will include improvements to the density of the dam’s body and face, development of an automatic measurement and control system, repair of civil construction and mechanical and electrical equipment, lock repairs, and reconstruction of fish ladders.

Wloclawek was built between 1962 and 1970. Polish utility Energa Hydro awarded a contract to ABB in 2011 to replace a transformer block in the project’s hydroelectric plant.

Statkraft prepares for Devoll project construction

Norwegian utility Statkraft A.S. has announced its intent to begin construction on the Devoll hydroelectric complex on the Devoll River in southern Albania.

The Devoll project will eventually include three separate hydropower plants, although Statkraft’s announcement only included two. The pair — called Banja (also spelled Banje) and Moglice — will have a combined capacity of about 240 MW and will cost $714 million. Both are expected to be in operation by 2018.

Devoll Hydropower Sh.A., which is developing the project, used to be a 50/50 joint venture between Statkraft and Austrian energy company EVN AG. EVN sold its share to Statkraft in March.

In July, Statkraft awarded a US$132.6 million contract to Alstom to supply six Francis turbine-generator units for Devoll. Also included in the order are hydraulic steelworks such as gates, penstocks, stoplogs and trashracks. Alstom said the equipment will primarily manufactured in its Spain and Turkey factories.

The project is the first large-scale public/private partnership in Albania and represents one of the largest hydro investments in the Balkans, Alstom says.

AfDB increases Grand Inga project financing

Two African Development Bank (AfDB) grants totaling US$5.25 million recently awarded to the Democratic Republic of Congo will help provide technical assistance for the Inga 3 project.

The grants fall within the framework of AfDB’s Fragile States Facility and “will help in the commencement of the crucial phase of preparing institutional and technical plans,” the bank said.

At an institutional level, AfDB said, the grant will help finance a national and permanent structure for the promotion and development of the Inga project’s hydro power potential. On a technical level, the funds will be used to provide legal and strategic advisers in an effort to create a public-private partnership for development of the Inga 3 phase.

AfDB had provided $15.7 million to Congo in 2008 for the development of an Inga expansion feasibility study. It suggested that Inga’s projected 40 GW of potential be developed in stages — the first being the 4,800 MW Inga 3.

A power-purchase agreement signed between Congo and South Africa in December 2012 helped solidify commitments to the Inga project, with the Congo government announcing its intentions to begin work on the Inga 3 portion by October 2015.

Laos, financial institutions working on hydro development laws

The International Finance Corporation (IFC) plans to work with the Laotian government in developing laws that would help govern hydropower development.

According to IFC, Laos is one of the poorest nations in southeast Asia but is amongst the richest in terms of natural resources. Through the past decade, investments have led to the development of about 20 hydropower projects, with up to 50 expected to be operational by 2025. This boom in hydro construction has been essential in boosting the country’s socioeconomic growth, IFC said, although it also increases competition among water users, making revisions to Laos’ 17 year-old water laws essential.

Hydropower developers are granted water rights through concession agreements. Under the revised law, rights would be granted using a formal, long-term permit-based system that would be easier to enforce.

“This law provides principles and measures necessary for the management, exploitation, use, development and protection of water resources, aiming to promote legal rights to use water resources that ensure balance and sustainability of socio-economic development and environmental protection,” the draft law said.

The Laos government, with IFC and World Bank support, is holding public consultations about the draft laws, with stakeholders in all sectors being invited to give their feedback. IFC said its consultation in Vientiane in May drew representatives from 13 hydropower companies and law firms, which discussed issues including dam safety, coordinated water releases and flow management.

The first version of the draft water law is available on the Laos Department of Water Resources’ website. The agency said it will continue soliciting comments about the proposal through the coming months, with a final revision to be submitted to the Laotian National Assembly by the end of the year.

Ecuador to study water resources project that includes hydro

Ecuador’s Instituto Nacional de Preinversion plans to hire consultants to perform pre-feasibility and feasibility studies and final design of the Olmedo multi-purpose water resource project in the Manabi Province.

The consultant hired will study the technical, economic, social, and environmental pre-feasibility and feasibility of the Olmedo project, as well as prepare final designs to implement the project. Development of Olmedo is planned to supply drinking water, irrigation and drainage in the region.

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  • Renewable Energy World's content team members help deliver the most comprehensive news coverage of the renewable energy industries. Based in the U.S., the UK, and South Africa, the team is comprised of editors from Clarion Energy's myriad of publications that cover the global energy industry.

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