Itaipu seeks definitions after Treaty with Paraguay ends in 2023


    After 2013 a new legal framework govern all issues of the world’s second largest hydroelectric dam with 14,000 megawatts (MW) of capacity, behind only the Chinese Three Gorges (22,500 MW)

    The definition of the commercial model is considered essential for Brazil, that by the current treaty has he right to use the volume of energy produced and not consumed by the Paraguayan part of the plant.

    The Itaipu hydroelectric plant ended 2016 with a historic production of 103,098,366 megawatt hour (MWh) and established a new world record in annual generation. The plant that never stops surprising ended the year breaking records. Itaipu recorded the best December of all times. At that month approximately 8.9 million MWh were produced.

    The increased production has raised the participation of Itaipu in the Brazilian electricity market in 2 percentage points, going from 14.6% in 2015 to 16.8% in 2016. In the South, Southeast and Central-West, regions of greater energy consumption in Brazil, the participation of the plant grew from 19.3% to 22.4%, an increase of 3 percentage points.

    The increased production of Itaipu also promoted the participation of hydroelectric plants in the national generator park in 2016. With the increased use of hydropower, which is cleaner and cheaper, the use of thermoelectric plants was reduced. Another positive aspect is the increase in the value of the transfer of royalties, which will be approximately 15%. From 1985 up to 2016, the plant paid approximately $10 billion in royalties to Brazil and Paraguay.

    Payment for the exploration of the water for power generation is set out in Annex C of the Itaipu Treaty. On the Brazilian side, the resources benefit sixteen cities, being fifteen in the State of Paraná and one in the State of Mato Grosso do Sul. Royalties are used to improve the quality of life of the population and the areas of education, health, housing and sanitation.