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Explain it Like I'm Five: Itaipú Basics

published by Christine Folch

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7 THINGS TO KNOW ABOUT ITAIPU
Explain it Like I'm Five


ITAIPÚ Binational Dam is the world's largest source of hydroelectricity.

ITAIPÚ DAM

governing the dam is up for renegotiation in 2023. Both the energy pricing & the  distribution agreements are up for grabs.
ITAIPÚ TREATY (1973)
ITAIPÚ Binational Dam is owned 50/50 by Brazil & Paraguay.
95,000 GWh
Average production a year, or more, can power 20% of Brazil, 33% of California (USA) or almost 7 Paraguays .
10/40/80
Paraguay gets ~10% of Itaipú electricity, which satisfies about 80% of its electrical demand. The 40% it doesn’t use is consumed in Brazil. Eletrobras pays the Paraguayan government a small below-market fee, called “compensation,” for it.
2030
Paraguay’s electricity surplus runs out. Paraguay’s electricity consumption has grown so much in the last decade that ANDE predicts that between 2023 and 2035, Paraguay’s demand will consume all its installed capacity, including the 40% of Itaipú that goes to Brazil. Residential use is growing the fastest.

Tariff = Expenses
The Treaty stipulates that the dam is not-for-profit, which means that it’s supposed to operate at cost. The average price Itaipú charges ANDE is $28.30/MWh & $40.86/MWh for Eletrobras, which includes compensation. Question: What happens to price when the debt is zeroed in 2023?
$3.4 BILLION
ANDE & Eletrobras get dividends: $23.5 million each in 2017. 
Paraguayan & Brazilian Treasuries get royalties:
$256 million each in 2017.
ANDE & Eletrobras get fees:  $19.7 million each in 2017.
Paraguayan Treasury also gets compensation from Eletrobras:
$340.3 million in 2017.
in energy sales covers debt, operations & government fees, but  does not include compensation.

2123 ... 150 YEARS? .
Like all machines, Itaipú has a limited lifespan after which it won’t work after which wear & tear + reservoir siltation will make energy production ineffecient.
Want to Know More?

Itaipú Post-2023
https://itaipupost2023.com/

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References

* Itaipú Treaty (Brazil-Paraguay, 1973). * Electricity available in Paraguay (2016): 14,855.1 GWh (VMME 2017:20). If Itaipú produces 95k-100k GWh/year, then the Paraguayan demand is 15.64% of the electricity produced by Itaipú or 31.27% of its half. *Some years more, some years less. 86.4% in 2017. IB Memoria Anual 2017 (2018) :26. *Growth in consumption from year to year from 2005 to 2016 at least 4% (VMME 2017:22, 23). *VMME (2017:23, 25, 45). *2017 % breakdown: 60.64% debt; 21.32% operations; 18.03% royalties & other fees. IB Memoria Anual 2017 (2018: 43-45)* Itaipú Technical Tour (2017)