Brazil President Luiz Inacio Lula da Silva and Paraguay President Nicanor Duarte Frutos participated in the May 21 inauguration of two final generating units that increased the 12,600-MW Itaipu hydroelectric project to 14,000 MW of installed capacity.
Situated on the Parana River on the Brazil-Paraguay border, the jointly owned project is the world’s largest operating hydropower project. (HNN 11/7/06) The initial stage of China’s Three Gorges Dam is to be completed to 18,200 MW by the end of 2008. (HNN 3/26/07)
Addition of the 19th and 20th 700-MW units by France-based equipment supplier Alstom required an investment of US$184.6 million by Brazil’s state-owned utility holding company Centrais Eletricas Brasileiras (Eletrobras). Completion of the units allows operator Itaipu Binacional to run 18 units at one time. Two units are kept idle for maintenance except in times of emergency.
The completed project is expected to generate 95 million MWh per year.
Itaipu to invest US$350 million on modernization
Officials said conclusion of the turbine-generator installations clears the way for Itaipu Binacional’s next task, a modernization program for the first 18 units, which were placed in service in the 1980s and 1990s.
The CanalEnergia agency reported the program is to cost US$350 million over ten to 12 years. Officials said the goal is to maintain efficiency and reliability demanded by the electricity market.
Itaipu produces 20 percent of Brazil’s power and 95 percent of Paraguay’s.
Paraguay renews call for revisions to Itaipu treaty
As Lula and Duarte signed 18 agreements for cooperation in areas of energy and commerce, Duarte used the occasion to renew his call for a review of the 1973 Itaipu treaty to secure more favorable terms for Paraguay.
�Sooner or later, it will be necessary to seek political and economic agreements to revise the treaty, seeking more justice and equality for our peoples,� the Paraguayan president said.
The Paraguay government has said Itaipu Binacional must pay 7 percent annual interest on its debt to Eletrobras, indexed to inflation in the United States, beyond a tax of 5 percent. Duarte has said the interest rate agreement, which was adopted by previous governments, is a financial setback for Paraguay.
Nevertheless, Duarte called Lula’s official visit to Paraguay historic because �never before has the Brazilian government pledged such economic and commercial relations with Paraguay.�