The two-year licence issued to Cemig, which owns the 330MW Aimores plant, will enable the construction of a transmission line just over 11km long between the plants. Mascarenhas has only recently reached its full installed capacity of 180.5MW when the fourth turbine-generator was installed late last year.

Energias do Brasil owns the Mascarenhas plant, and itself is the Brazilian arm of Electrite de Portugal. The company has just reported output generated in 2006 was up almost 43% to 3.929GWh. Earnings before interest, taxes, depreciation and amortisation (EBITDA) lifted 17.6% to R$1.07B, with both output and income helped by the start of operations last year of the 452MW Peixe Angical hydro plant.

Elsewhere in the country, approval was received from the environmental ministry in the state of Rio Grande do Sul for construction of the 67MW Monjolinho hydro plant. The R$160M project is scheduled to be finished in 28 months, or by late 2009, and begin supplying power to the market from January 2011 under the terms of the recent market auction.

Monjolinho has been on the drawing board of Engevix, the Brazilian consulting engineer, for a few years. The consultant has worked on a number of hydro projects, including Itaipu, Ita and Salto Caxias, and is looking for equity and developer involvement in the sector.

Engevix and its investment vehicle Desenvix have been developing the project on a 78.75% to 21.25% split through the special purpose vehicle Monjolinho Energetica, or Monel, since the beginning of the decade.

Early estimates budgeted the development of the project at R$158M to start operations in late 2003, a concession having been awarded in 2002. Plans for start-up were delayed to 2004 and then the liberalisation of the electricity market through auctions saw Monel obtain a 30-year concession from 2011 and once more look to construct the scheme, which is now finally getting underway.