Hitachi and Mitsubishi plan consolidation
Tokyo-based engineering groups Hitachi, Mitsubishi Electric, and Mitsubishi Heavy Industries say they plan to initiate concrete discussions that could lead to consolidation of their hydroelectric operations.
In a statement, the three companies said they would look to jointly establish an operational hydropower company, including marketing, servicing, engineering, development, and design activities.
According to the statement, the move was prompted by an increasingly competitive market, particularly from Chinese manufacturers and established European players. In considering the market, the Japanese companies point to several positive underlying factors, including demand for renovation and preventative maintenance in their home markets, as well as vigorous and sustained demand in China, Latin America, and India. However, they also acknowledge that, in the current business environment, the most effective means to sustain and expand the business is to consolidate.
In particular, the two companies have declared their intention to secure the world-leading position in the variable-speed pumped storage generation sector.
Merged, the company is to begin operations on October 1, 2011, and be held 50/50 between Hitachi and Mitsubishi. The split between Mitsubishi Electric Corporation and Mitsubishi Heavy Industries Ltd. is to be decided later.
Small hydro buyouts in China
Two acquisitions of small hydro assets have taken place in China recently.
In the first, China Power New Energy Development Company Ltd. reportedly said it will acquire full control of a 36.6 MW project in southeastern China for RMB39.2 million (US$5.7 million) in cash.
The company has agreed to buy the 49 percent stake it does not own in the hydro plant's owner, power utility Zhangping Huakou.
Recently, China Hydroelectric Corporation (CHC), a consolidator, developer, and operator of small hydro projects, signed definitive agreements to acquire a portion of the previously announced Minrui hydro projects in China's Yunnan Province.
CHC had previously announced execution of a memorandum of understanding to acquire 100 percent of the Minrui group of projects, which included four operating hydro projects aggregating 66 MW and three projects under construction aggregating 125 MW, as well as the development rights to nine projects aggregating 341 MW.
Meanwhile in the second deal, AES Corporation's wholly-owned subsidiary, AES China Hydropower Investment Co. Pte. Ltd., has entered into an agreement to acquire a 49 percent interest in the Jianghe Rural Electricity Development Co. Ltd. joint venture.
AES China Hydropower is acquiring the interest from the China Water Affairs Group for RMB333.2 million ($48.8 million). Jianghe Rural includes six small hydro projects in China's Yunnan and Fujian provinces with a combined capacity of 241 MW, AES reported.
Acquisition of 35 percent ownership was completed in June, and the transfer of the remaining 14 percent ownership is expected to occur by the end of 2010.
Jianghe Rural develops, constructs, and operates small to medium hydro projects in China. Acquisition of the Jianghe Rural projects will increase AES China's hydro operating capacity to about 266 MW.
Rodund II hydro plant rehab deal
Voith Hydro has won a contract to supply equipment to rehabilitate the Rodund II pumped-storage plant in Austria, which was damaged during a fire last summer.
The scope of supply comprises a reversible pump turbine, an air-cooled motor-generator, and related ancillary equipment. The contract is worth €40 million (US$49.31 million).
Furthermore, the plant, operated by Voralberger Illwerke, will see an upgraded energy management system. By replacing the original unit, which had been in operation since 1976, and associated upgrades, output will increase from 276 to 295 MW. Only the powerhouse, spiral case, draft tube, and some mechanical auxiliary equipment will remain in place, Voith reported.
Rodund II is located in the Austrian Montafon area.
Alstom turbines for Chile's Angostura
Chilean utility Colbun has signed a US$123 million contract with France's Alstom for three turbines for the Angostura project being developed in Chile, wires services report.
As part of the contract, Alstom will provide Colbun with two 136 MW turbines and one 48 MW turbine, Business News Americas reported.
The 320 MW Angostura project is planned for Chile's Biobio River in southern region VIII. Colbun expects the US$420 million project to be online in early 2013.
Poyry wins European pumped storage contracts in Austria and Sweden
Global engineering and consulting firm Poyry has been awarded contracts by Austrian utility Verbund to provide engineering services and site supervision during construction of the 430 MW Reisseck II pumped-storage plant.
The overall value for Poyry in the two contracts amounts to about €9.2 million (US$11.26 million). Prior to these contracts, Poyry executed the tender and approval design for the Reisseck II hydroelectric power plant.
Recently, Poyry was also awarded a surveying contract for the Limmern pumped-storage hydropower plant in Switzerland. Worth about €2.1 million ($2.7 million) to Poyry, the services comprise all geodetic surveying tasks during the construction period lasting until 2015.
Kraftwerke Linth-Limmern AG is developing the 1,000 MW Limmern project in the Linthal Valley in eastern Switzerland. The underground powerhouse will contain four 250 MW reversible vertical Francis pump-turbines and four 280 MVa vertical asynchronous motor-generator units pumping water from Lake Limmern into Lake Mutt.
Poyry was also awarded the HVAC design contract for Limmern, including the tender process, the detail design, and construction supervision for the building equipment and safety facilities. The value is about €1.7 million ($2.1 million).
The tender services, starting with a review of the existing design project, will be completed in 2012 with the award of the building equipment contractors' contracts. The detailed design phase will last from spring 2011 to spring 2012. Between 2012 and 2015, Poyry's construction supervision will make sure that all systems can be put into operation in December 2015.
Emerson reveals control system contracts
Emerson Process Management has been awarded a US$28 million contract to control, protect, and monitor 100 hydro units of the Dnipro hydroelectric complex for OJSC UkrHydroEnergo (UHE) in Ukraine.
The existing cascade of nine hydro plants, with dams and reservoirs, has a total capacity of 4,590 MW and is located along a 1,000 km stretch of the Dnipro River. The deal is part of a rehabilitation program of UHE's hydro assets — the first hydropower plant of this system was built in 1934, and the last was completed in 1980.
Emerson will serve as the primary automation contractor during this modernization, responsible for control, protection, and SCADA systems. Each of the nine UHE plants will be monitored and controlled by an Ovation control system.
Recently, Emerson installed its PlantWeb digital plant architecture with the Ovation expert control system at Unit 1 of the newly-commissioned Dnister pumped-storage plant in Ukraine. The plant will be one of the largest pumped-storage projects in the world.
Meanwhile, Emerson also signed a memorandum of understanding with Korea South East Power Company (KOSEP) to collaborate on modernizing hydro and thermal plants and developing new ones in Korea, the Middle East, Africa, Southeast Asia, and Latin America, Emerson announced.
KOSEP, a developer, operator, and owner of hydro and thermal power generation facilities, will use Emerson's automation, control, and instrumentation technologies in power plants in the emerging markets in which it operates, Emerson reported.
CDM approval for small hydro
The Development Bank of the Philippines (DBP) and Tricorona Carbon Asset Management Pte Ltd. have signed an agreement for the sale of certified emission reduction credits generated by three mini-hydropower plants in the Philippines, regional media reports.
DBP is working on registration of the projects with the United Nations Framework Convention on Climate Change Clean Development Mechanism (CDM) Executive Board, Malaya Business Insight reported.
The three projects are: Cantingas, owned and operated by Romblon Electric Cooperative Inc.; Hinubasan, owned and operated by the municipality of Loreto, Dinagat Islands; and Sevilla, owned by Bohol Electric Cooperative (BOHECO) I and the municipality of Sevilla.
The projects are expected to deliver emissions reductions of about 111,000 tons during the first seven-year accounting period.
Recently, a Bhutan hydro project supported by the Asian Development Bank and the governments of Austria and Japan was registered as the first cross-border initiative under the CDM. The 114 MW Dagachhu run-of-river project will enable Bhutan to export power to India.
Dagachhu, which is being built on the Dagachhu River in the southwestern district of Dagana, is expected to begin commercial production by the end of 2012. The company established to manage the project is led by Bhutan's state-run utility, Druk Green Power Corporation, and India's Tata Power Company, reports indicate.
World Bank loan for Indian dam rehab
The World Bank has approved a US$780 million loan to fund infrastructure projects in India, including $350 million for improvements to 220 dams, wire services reported.
The Dam Rehabilitation and Improvement Project aims to improve the safety and sustainable performance of selected dams in Kerala, Madhya Pradesh, Orissa, and Tamil Nadu. It is also intended to strengthen the institutional, legal and technical framework for dam safety assurance within India's government and in the participating states.
One unit of Beles project in Ethiopia begins generating power
The Beles hydropower project in Ethiopia began operating in May 2010 with a single 115 MW turbine as part of a trial run, wire services reported.
Ethiopia Electric Power Corporation officials said the project will help to address a power shortage in the country, wire services reported.
The plant's four turbines each have a 115 MW capacity. All units of the hydro project are expected to begin operations within a matter of weeks, wire reports indicate.
Serra do Facao to start operations
Brazil's 210 MW Serra do Facao hydropower plant is projected to come online as HRW goes to press, apparently ahead of schedule.
According to wire reports, Serra do Facao was initially planned to come online in October 2010, but the president of developer Serra do Facao Energia consortium has reportedly suggested the plant would be operating several months earlier.
Total investment in the project, located in the Brazil's center-western state of Goias, is set to reach BRL1 billion (US$559 million).
The Serra do Facao Energia consortium is formed by Brazilian federal power company Furnas (49.5 percent), U.S. aluminum maker Alcoa (30 percent), Brazilian power company DME Energetica (10 percent), and construction company Camargo Correa (10.5 percent).
Turkey privatizes state-operated hydro assets
Privatization of most of the 52 hydropower plants owned by the Turkish Electricity Generation Company (EUAS) has been completed, raising a total of US$427.2 million.
According to wire service reports, the privatization was held in 19 groups and will give the new stakeholders the right to manage the plants for 49 years.
The process was launched in May and ended with the final negotiations for the 600 MW Dere and 1,040 MW Ivriz plants in the city of Konya, central Anatolia.
Recently, Canadian renewable energy firm Reservoir Capital Corp. signed a memorandum of understanding to acquire a 75 percent interest in six small projects in Turkey.
Construction of the projects is scheduled to begin in the second half of 2010, with the first plant coming on-line in early 2011 and the remainder in stages before the end of 2012, reports indicate. The projects will have a combined capacity of about 30 MW, according to a press release.
Meanwhile, Andritz has announced it will supply electromechanical equipment with a total value of about €340 million (US$417.4 million) as part of the construction of the 1,200 MW Ilisu hydropower station in Turkey.
After the temporary suspension of the supply contracts for the project, all contractual requirements for their resumption have now been met.
Andritz Hydro will supply six 200 MW Francis turbines, six generators, additional equipment, and engineering services. The delivery time is seven years in total. Andritz Hydro is part of a consortium led by Turkish construction company Nurol that includes other European and Turkish companies. Total costs of the project are about €1.1 billion.
Chile rejects royalty tax for hydro
Chile's minister of energy has said the government does not plan to impose royalty taxes on hydroelectric generators, wire services report.
Former President Michelle Bachelet had proposed levying a capacity-based tax on generators that would be directed toward municipalities where hydro projects are located. Power firms typically pay taxes to the municipality in which their corporate headquarters are based. The new administration of President Sebastian Pinera is expected to define its position on the proposal as HRW goes to press.
In other news, Chilean utility Compania General de Electricidad S.A. plans to begin construction this year on its 136 MW Nuble run-of-river project, which could put the hydro project on schedule for completion in 2013.
Environmental regulators approved the project in October 2008, and construction was slated to begin in 2009.
Pumped-storage plans for Vietnam
Vietnam is planning to build a pumped-storage project with total capacity of 1,500 MW, the first in the country.
Officials have given an in-principle approval to construction of the plant in the northern province of Son La, to begin in 2013. It is expected to be operational in 2018, according to media reports.
Elsewhere in Vietnam, Cavico Corp subsidiary Cavico Mining has signed a construction contract for Portal No. 2 at the reservoir of the Ngan Truoi Irrigation Dam and hydro project in the Ha Tinh province of Vietnam.
The expected revenue value of this contract is about US$3.3 million. In May 2009, Cavico signed a contract for $8.5 million to construct Portal No. 1 at the site.
Cavico will be responsible for construction of a diversion dam, water intake gates, and a groin dam distributor. Portal No. 2 will be 2.5 m in diameter and 464 m in length. Cavico expects to complete the construction within 24 months.
Ngan Truoi is being developed by the Ministry of Agriculture and Rural Development with a total capital investment of about $167 million. The project, initially approved by the Vietnam Government Office in 2006, is considered the most critical in the province. Upon completion, the dam will provide water to 35,000 hectares of farm land, help reduce damages from the Song La River during flooding season, and provide 20 MW of hydro capacity.
Picchu power link planned for Peru
Peru's investment agency plans to construct a transmission line to deliver electricity from new hydroelectric developments, including an expansion of the 107 MW Machu Picchu project and the 129 MW Santa Teresa project.
A consortium of ABB of Switzerland and Harbin Electric Machinery Co. Ltd. of China is supplying electromechanical equipment for rehabilitation and expansion of Machu Picchu in Peru's Cusco Region to 206 MW.
Investment agency Agencia de Promocion de la Inversion Privada (ProInversion) also is pursuing construction of Santa Teresa, 3.8 km downstream from Machu Picchu.
ProInversion has opened bids for a concession to construct and operate the 220 kV Machupicchu-Abancay-Cotaruse transmission line. The project is intended to upgrade the electrical system of southeastern Peru to more reliably deliver power to the region's demand centers. ProInversion said the estimated US$80 million line will help solve problems of grid overloading, instability, and congestion.
The winning bidder, to be named in October, would be responsible for design, financing, construction, operation, and maintenance of the project during 24 months of construction and a 30-year concession period. After that, the line would be transferred to the government.
Grid and hydropower project in Laos
China Southern Power Grid has reached an agreement with the government of Laos to build a national power grid and a hydropower project in the country.
The state-owned power distributor in China's five southern provinces has, wire services report, signed a memorandum of understanding on investment in and construction of a grid network in Laos as well as an agreement to develop the Nam Tha 1 hydro project.
Pre-feasibility for Lesthoto's 1,000 MW Monontsa project
Lesotho Electricity Co. plans to perform a pre-feasibility study of the 1,000 MW Monontsa Pumped-Storage project.
The development follows the 2009 African Development Bank approval of a loan and a grant totaling 11 million Units of Account (US$16.4 million) for the Lesotho electricity supply project. That focuses on renewable energy including mini-hydropower, as well as a pre-feasibility study of a 1,000 MW pumped-storage project.
Currently, nearly all Lesotho's locally produced electricity comes from 70 MW Muela, part of the Lesotho Highlands Water Project. Because power-strapped South Africa has been rationing power supplies to Lesotho, its neighbor has been seeking ways to boost hydro generation.
The pre-feasibility study of Monontsa will include a topographical survey of the site; assessment of geological and geotechnical conditions; assessment of dam types and locations; and assessment of reservoir capacities based on dam construction and production costs of the entire power system, among other considerations.
Elsewhere in Lesotho, the government is seeking engineers to serve on a dispute board and an insurance adviser for its project to build and operate Metolong Dam.
To be built on the Phuthitsana River near Metolong, Metolong Dam is a Lesotho Lowlands Water Supply project that is to supply domestic and industrial water to six lowland districts of Lesotho. The government pre-qualified firms to build the dam and a raw water pumping station in May 2010.
The Metolong Program Implementation Unit is to establish a list of potential board members.
Bidding planned for Brazil's Teles Pires
Brazil's energy research agency predicts a concession auction could be conducted by the end of 2010 to develop the 1,820 MW Teles Pires project on the Teles Pires River.
Empresa de Pesquisa Energetica (EPE) submitted a favorable environmental impact assessment on the project to Brazil's environmental agency, Instituto Brasileiro de Meio Ambiente (Ibama). If Ibama issues a preliminary environmental license sometime this year, Teles Pires could be auctioned by the federal government by the end of 2010.
EPE said the project has the largest capacity of several proposed projects in the Teles Pires River Basin. In 2006, Brazil's electricity regulator, Agencia Nacional de Energia Eletrica (ANEEL), approved a study of the Teles Pires River that identified the potential for developing six hydro projects totaling 3,697 MW. Brazil's Ministerio de Minas e Energia previously predicted concession auctions in 2010 for hydro projects on the Tampajos and Teles Pires rivers. National utility Centrais Eletricas Brasileiras S/A (Eletrobras) coordinated the study of the Tele Pires sites, in Mato Grosso and Para states of Brazil's Amazon region, in conjunction with utilities Centrais Eletricas do Norte do Brasil (Eletronorte) and Furnas Centrais Eletricas S/A.
EPE said the 152 km2 Teles Pires reservoir would have an average of 0.08 km2 flooded per installed MW, compared to a five times higher national average for other hydro plants of 0.49 km2/MW.
Green light for Philippine hydro
Oriental Energy and Power Generation Corp., the power arm of Oriental Peninsula Resources Group, recently got approval from the Department of Environment and Natural Resources (DENR) to proceed with the 18 MW Timbaban project in Madalag, Aklan.
The environment compliance certificate granted by DENR outlines the company's duties and responsibilities in ensuring that the environment and immediate surrounding communities of the Timbaban plant will not be disturbed or harmed during construction. The Timbaban project is the first of five small hydro facilities set to be developed by Oriental Energy, media reports indicate.
With a combined generation capacity of 55 MW, these projects include the 15 MW Culaman run-of-river plant in Manolo Fortich, Bukidnon, as well as three service contracts for the upper, middle, and lower cascades of the Odiongan River in Odiongan, Misamis Oriental, with total expected output of 22 MW.
New hydro plans along China's Jialingjiang River
China Power Investment Corp. (CPIC) plans to develop a further 16 new hydro projects along the Jialingjiang River.
The plants will cost RMB2.8 billion (US$410 million) to build and have a combined installed capacity of 273 MW.
The highest concentration of hydropower plants will be based in southwest Shaanxi Province, while other projects will be located in Gansu and Sichuan Provinces and Chongqing Municipality, wire services reported.
One plant is under construction, and three more are experct to be finished next year. The remaining 12 plants are due to be competed by 2020.