UPDATE: 2.3GW wind in Brazil A-5

The latest Brazilian national power tender saw deals struck by 97 wind projects, totalling 2.34GW of installed capacity.

The average asking price for wind power in Friday’s A-5 competition was R$119 ($51) per MWh, 2.45% below the initial price cap.

Altogether, these projects will require $8.7bn in investments.

The result means that in 2013, Brazil has bought more than 4.6GW of wind capacity.

Although allowed to participate in the auction, no solar project was successful.

The number of wind projects awarded in the tender was a great surprise for the industry, as before the auction sources estimated that wind would bite around 1GW of the A-5's total demand.

However, due to the lack of hydro and thermal projects, the government had no choice other than calling on wind generation.

In May Rechargereported that if the requisite thermal baseload generation did not come through in the tenders, the Brazilian government would use the second A-5 tender in 2013 as a “back-up window” to fulfill distributor company's demand with wind projects.

Elbia Melo, the head of the Brazilian Wind Energy Association, ABEEólica, tells Recharge: “We are very much delighted with the 2013 tenders outcome. At the beginning of the year, we would not imagine at all that this amount of wind energy would be viable."

Strangely, the average price for wind in the A-5 competition stayed above the one struck in the wind-only reserve auction, held in August, when 1.5GW of projects were contracted at R$110 per MWh.

In the earlier auction, developers were dealing with a construction time for the projects of only two years, while in the A-5 the timeframe to bring the plant into operation is four years.

The official of one company that won many projects in the A-5 tender says that there was little competition among wind projects because of the large amount of demand. "If only 1GW of projects could have been contracted, we would have seen a very much lower price due to the competition. Everyone wanted to sell in this tender."

Apart from wind generation, the A-5 tender contracted around 1GW of hydro plants and 160MW of biomass projects, totalling 3.5GW of new capacity.

Note: Update adds further detail, reaction