Small means big in Brazil

28 May 2008

Last month’s symposium on small hydro highlighted the latest developments and areas of particular interest in the Brazilian small hydro market. Report by Samantha White

The 6th Brazilian Symposium on Small and Medium Hydroelectric plants was held from 21-25 April in Belo Horizonte, Minas Gerais. The event was organised by CBDB (Brazilian Committee on Dams) in partnership with the CERPCH (National Centre for Research into Small Hydro Plants) and with the support of local power utility Cemig. The event had a parallel exhibition to showcase products and services related to the construction and operation of small and medium hydro plants, and electricity transmission.

A number of topics were discussed at the symposium, in particular the benefits of the carbon credits market to small hydro plants (SHPs), noise emissions and worker health and safety, reservoir accretion and its environmental impacts, and optimal layouts for SHPs. Many of the papers highlighted important issues for consideration at the project design stage.

Carbon credit market

In their paper on carbon credits, Elton Massaneiro Sucek and Milton Francisco dos Santos Junior, of Copel’s generation planning division, argued that the evolution of the new market should lead to small hydro becoming a more attractive investment.

Since its inception in February 2005, the markets in carbon credits have created fresh opportunities for energy project development in developing countries, such as Brazil, especially as its electricity generation sector produces relatively low quantities of greenhouse gases (GHGs).

According to the World Bank, the carbon market grew to US$30B in 2006, which was three times greater than the previous year. In 2007, prices ranged from US$2/tonnes–US$19/tonnes of carbon dioxide equivalent (CO2e) of GHGs.

The region’s economic commission (Comision Economica para America Latina y el Caribe – ECLAC) estimates that Carbon Emission Reduction credits (CERs) generated by Latin America’s Clean Development Mechanism (CDM) energy projects sell for US$40/tonnes–US$60/tonnes of CO2e. In comparison, the rates for carbon recovery forestry projects is US$10/tonnes–US$20/tonnes of CO2e. Going forward though, CER prices are expected to rise as OECD countries will need more credits to help them comply with their emission reduction goals under the Kyoto Protocol.

CDM projects are mostly located in South Asia, particularly China and India, as well as Latin America, where they are concentrated in Brazil – in the south, south east and centre west regions. Brazil has the 3rd largest number of CDM participant projects in the world, of which small hydro (21% of Brazilian CDM projects) is second to biomass (55%).

While there were 27 hydroelectric projects, including several SHPs, approved as CDMs under Resolution 1 of the Brazilian Interministerial Commission on Global Climate Change prior to October 2007, the scale of the Brazilian hydro power sector is much larger than this would indicate. Between 1998 and last year there were 340 SHPs authorised in Brazil, with a total installed capacity of 4.6GW. The typical baseline emission per unit of generated electricity for renewable energy projects connected to the transmission grid in the south, south east and centre west areas is 0.267tonnes of CO2e per MWh.

Brazil’s national electricity agency, Aneel, in its Resolution 652, classifies small hydro projects as having an installed capacity of between 1MW-30MW and a flooded area of up to 3km2. (Hydro plants with a larger reservoir area can still qualify if they meet additional conditions.)

SHPs help promote the development of remote regions of the country by extending the energy network into those areas. Recent changes in legislation were designed to attract new players to the energy sector, particularly small hydro, including a simplified process to obtain a concession and environmental licence, discount of at least 50% on use of distribution and transmission systems and numerous tax breaks. SHPs can then sell their energy at auction or on the free market, direct to consumers; to Eletrobrás under the PROINFA programme to promote energy from alternative sources; or to distribution companies.

To benefit from the carbon credits market, projects must be certified within the CDM. Research indicates that certification of large-scale projects takes an average of 14 months in Brazil, which arises from:

• Five months to prepare the Project Design Document (PDD).

• Three months for validation by the designated operating body;.

• Three months for approval by the Inter-ministerial Committee on Global Climate Change.

• Three months for registration by the Executive Committee of the UNFCCC.

The approximate costs involved are:

• Project Design Document – R$120,000 (US$72,600).

• Validation – R$60,000 (US$36,300).

• Cost of CERs (up to 15,000 certificates) – US$ 0.10 / CER.

• Cost of CERs (over and above 15,000 certificates) –US$ 0.20 / CER.

• Adjustment fund – 2% of the value of CERs.

• Approval – R$800,000/yr (US$485,000/yr).

There is a simplified certification process for small-scale projects, classified as follows:

• Renewable energy projects with maximum production capacity of up to 15MW.

• Energy efficiency improvement projects which reduce consumption of energy on the supply and demand side by 15GWh/yr.

• Other activities which reduce man-made emissions and directly emit less than 15,000tonnes of CO2/yr.

The national development bank (BNDES) offers credit to fund viability studies, project development and design costs as well as the validation and registration process. The bank also has a clean development programme specifically targeted to CDM projects.

According to a study by Massaneiro Sucek and dos Santos Junior, the rate of return on investment on an SHP with the following parameters was 17.1%:

• Assured energy 8.25MW

• Eight batches sold at auction 70,080MWh/yr

• Reserve price in the auction R$135/MWh (US$82/MWh)

• Implementation costs R$70M (US$42.5M)

Energy generated by the SHPs results in a reduction in greenhouse gas emissions of 19,296.09t CO2/year. The rate of return on investment is directly related to the market value of both CERs and energy. With a constant energy price, an increase of US$10/tCO2e in the CER price results in an approximate increase of 1.3% in the rate of return.

For average CDMs, the gross annual receipt from the sale of CERs to the value of US$20/tonnes of CO2e is R$887,620 (US$538,100). Accreditation costs are estimated at R$265,000 (US$161,000), thus receipts are three times greater than costs of certification, which would therefore pay for itself in four months.

Health and safety: noise

A paper assessing noise levels at two SHPs in Minas Gerais was given to the symposium by Luiz Felipe Silva, Mateus Ricardo and Marcos Eduardo Cordeiro Bernardes of Itajubá University.

Although small hydro is generally considered to be a clean technology, they noted that noise emissions can have repercussions on the health of local communities causing hearing loss, high blood pressure and stress. A previous study by Celik found that 56% of workers at a hydro plant experienced hearing loss due to noise.

The most significant source of noise in an SHP is the generating unit(s). Noise levels were measured, using a Lutron SL-4001 meter, both inside the two plants – the 3.34MW Rede Eletrica Piquete-Itajuba (REPI) plant, Wenceslau Braz city, and Luiz Dias SHP in the Itajubá region - and at intervals along the opposite bank of their respective rivers. The data at the REPI plant was 58dB, which exceeded the 55dB national regulations on noise emissions to local communities. Values observed at the Luiz Dias would also have exceeded regulation if the site was located in an urban area. However there are no such restrictions in place for such SHPs located in rural areas.

Noise levels emitted by the auxiliary plants in both locations also exceeded regulations. In the REPI auxiliary plant, average levels were of 88dB as there is no purpose-built, insulated

control room. However, workers only need to carry out limited tasks in this area and therefore are not exposed to the noise for long periods.

Workers were exposed to noise levels 86.8dB near the generating units in the main plant at REPI, exceeding national standards, and 85.3dB in Luiz Dias. As workers do not have to spend long periods around the equipment, the noise pressure values were not deemed to constitute a risk. However, if workers were to spend 2.5 hours a day near the REPI generating units, further preventative measures would become necessary. A hearing protection programme, consisting of more than just the distribution of individual protectors, is essential for the health of plant workers.

In the REPI control room, the noise level was 70dB, exceeding the recommended range of 45dB–65dB. The room requires better insulation. In contrast, Luiz Dias was found to have adequate insulation and a level of 59dB.

The authors stated that as studies of available literature point to technology available to reduce noise emissions to acceptable levels, they suggest that further study on worker exposure to noise, and noise emissions to the community, is necessary. They also suggest that these issues should be considered as a form of pollution and taken into account from the initial design stages of an SHP.

Project design

A series of case studies of the proposed layout of – and recommended modifications to – SHPs and medium hydro plants were outlined by geologist Nobutugu Kaji of Grupo Energia Consult. He explained that over the last 10 years many SHPs have been developed by private enterprise, and have drawn on the skills of technicians with familiarity on larger projects but who didn’t always have sufficient experience in developing the basic layout and configurations of projects for which they have correspondingly greater say in smaller projects.

According to Kaji, this matter of experience in design of SHPs has resulted in many hydro projects, especially SHPs, not being adequately thought out. For example, he says, the use of standard layouts can offer private investors attractive costs but may also result in far from optimal designs that often prove to be incompatible with local conditions. To correct the limitations of such layouts, Kaji reviewed 50 projects and considered the relevant geological, hydrological and topographical factors, the type of equipment, construction methods, availability of natural construction materials and environmental impacts. He found that modifications of some degree were required for every project.

For example, one project (Case A) was designed with an underground powerhouse located next to the dam axis in highly permeable rock and the plan also featured a long, deep excavation of a tailrace tunnel. In addition to the unsuitable rock type, the long accesses to the powerhouse would involve massive excavation and extraction of materials, not to mention problems of drainage, ventilation and lighting. A field visit revealed the presence downstream of rock of better geomechanical properties. A revised layout was suggested, which would relocate the underground powerhouse to the more competent rock and also made construction of a shallow headrace channel a much more economic, safe and flexible option, and resulted in a shorter tailrace tunnel. While this type of arrangement is rare in SHPs, it is more commonly seen in HEPs.

In Case B, the proposed project included an open spillway and river diversion in the valley floor. This type of layout is common in similar topographical circumstances and has the advantage of reducing the volume of excavation necessary, as well as excellent hydraulic performance. However, this meant that construction works including drainage, cleaning and excavation of cofferdams up and downstream and treatment and concreting of the foundations would have to be carried out over the five-month dry season. Therefore, the spillway was moved to the left bank, meaning that all construction could be carried out regardless of the season, and a smaller amount of concrete was used as the foundations were higher up.

Case E’s original layout included location of a headrace tunnel in a rugged area necessitating a large volume of excavation, and high, steep cutting slopes in weathered and fractured rock. These factors hampered the location of works to dam the river. Around the powerhouse, located 5km from the dam axis, surveys indicated the presence of rock with better geological conditions and topography suitable for a diversion tunnel, which led to rejection of the headrace tunnel and concentration of works in this area.

Obvious measures to minimise the amount of excavation necessary were common threads in the case studies and controlled spillways were generally favoured over open spillways in the riverbed. Attention to local geological conditions was often found to be lacking in project design.

Reservoir accretion

Jefferson Bandeira and Lécio Salim, of the National Commission on Nuclear Energy (CNEN), studied reservoir sedimentation and resultant environmental impacts on downstream watercourses.

The authors noted that while controlled operation of reservoirs alters the natural discharge of rivers and can reduce their capacity to transport sediment, rivers should continue to be two-way systems with fish able to go up, and sediment to come down even in the presence of a dam. They said sluice gates were not effective to minimise sedimentation as they operate over fairly restricted areas. In practice, many gates in fact remain constantly blocked by deposited sediment.

Due to its low velocity on entry into a reservoir, the heavier materials fall out of the flow earliest, such as sand, leaving finer sediments to be deposited nearer to the dam and some will still remain in suspension and be discharged with downstream flow. It is recommended that reservoirs are dredged and the spoil taken downstream for disposal. In addition to environmental benefits by helping, to some degree, rebalance some of the sediment load in the watercourse, and contribute to maintained fisheries, this approach can also help reduce sediment damage to turbines.

A case study was carried out on the Pampulha reservoir, in Belo Horizonte, which was selected as it has experienced significant sedimentation, caused mainly by fine sediment. In 1957, the reservoir had an initial volume of 18.1x106m3 but by 1999 the available storage volume had fallen to just over 8x106m3 – a decrease of approximately 56%. The transportation capacity for fine sediment was evaluated over a stretch 25km downstream. Physical environmental impacts were studied using a radioactive tracer and marking fine sediment with technetium 99mTc, simultaneously marking the water with the fluorescent tracer Rhodamine WT.

A mathematical model was applied to the data obtained and dumping of the dredged material was simulated. The results showed an increased concentration of fine sediment in the dumping site which was carried rapidly downstream due to natural dispersal and dilution by the watercourse. It was concluded that there was no reason against the dumping of fine material here.

Fine sediments are important vectors in the transport of nutrients and organic matter and are therefore vital to the preservation of aquatic life. When fine sediment is retained in reservoirs, the amount of fish downstream is drastically reduced, as observed in the São Francisco river. Retention of coarse sediment, particularly sand, can produce alterations in reservoir discharge and together these can cause changes in the profile of the riverbed, in turn leading to erosion at the edges. In the long-term, sand retention leads to disequilibrium at the mouths of rivers and surrounding coastline. Long distance dredging can overcome the limitations of sluice gates in terms of the area reached. In addition selective dredging can be undertaken, of either fine or coarse sediment. It should be noted that there is specific legislation in Brazil governing sediment dumping.

Future reservoir sedimentation and its impact downstream should be considered right from the design stages, the authors advise. Once a dam is operational, the process should be monitored via bathymetric surveys, which can indicate the need for corrective measures in the river basin upstream. As it is not normally possible to control sediment production upstream, dredging the reservoir is a more viable alternative. Bathymetric surveys will indicate when this is necessary. Where selective dredging has been carried out, the sand can be used in construction, generating additional revenue for the project.

For further information on the Brazilian Committee on Dams, visit: Details on the National Centre for Research into Small Hydro Plants can be found on

The 23rd icold Congress will be held from 25–29 May, 2009 at the Ulysses Guimarães Convention Center, Brasilia, following the organisation’s 77th Annual Meeting. The subject of the symposium is “Dams for Multiple Purposes”. For more information, go to:


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