Info Report Check
Submission incomplete:
1: The DOE is requested to describe how it has validated the suitability of the input values used in the financial calculations as per VVS version 09.0 paragraph 129 (a) (b) (c).
i) The CAR14 of the validation report (p 127) states that the electricity tariff has been changed from R$141.93/MWh (sourced from data dated August 2010) in the GSC PDD to R$91.20/MWh (sourced from data dated Dec/2010) since it was the latest data available before the investment decision date (01/03/11) and the same was accepted by the DOE. Furthermore, the CAR 35 (p. 138) states that the value of R$91.20/MWh was not in line with the project’s investment decision date and was further updated to R$67.31/MWh (sourced from data also dated Dec 2010). The DOE closed this CAR considering that R$67.31/MWh was the most recent information prior to the investment decision date. Therefore, the DOE is requested to provide further information on how it has validated the suitability of the electricity tariff value, in particular, how it has concluded that the electricity tariff applied by the PP is relevant to the project activity. (please refer to the Guidelines on the Assessment of Investment Analysis EB62 Annex 5, para. 6); and
ii) The validation report (p 41) states that the DOE has validated the electricity tariff by checking the Public Brazilian Energy Auction of 17 December 2010 and it has crosschecked the same by checking the website of http://www.epe.gov.br/imprensa/PressReleases/20101217_1.pdf . However, it appears that the website site referred for crosschecking is the same document referred for validation. Therefore, the DOE is requested to provide further information on how the electricity tariff has been crosschecked against other sources as per para 129 (b) of VVS version 9.

2: The DOE is requested to include information on how it has validated sensitivity analysis of the investment analysis as per VVS version 09.0 paragraph 129 (e).
The validation report (p 42) states that “the electricity tariff of the Project was established by the energy auction carried out by the Chamber of Electric Energy Commercialization (CCEE) on 17 December 2010. The value of the electricity tariff was fixed at R$ 67.31”. The DOE is requested to provide further information on how it has validated that the electricity tariff will be fixed during the investment analysis period considering that the referred energy auction is not specifically to the project activity.