SPIC Brasil signs R$1.4 billion contract with Chinese consortium to expand São Simão hydropower plant by 310 MW

SPIC Brasil has contracted a Chinese consortium comprising Dongfang Electric Corporation and China Gezhouba Group Corporation (CGGC) to execute the main engineering and construction package for the seventh generating unit at São Simão hydroelectric plant. The R$1.4 billion project will add 310 MW of capacity to the facility located on the border between Minas Gerais and Goiás states. The expansion was qualified in the March 2026 Capacity Reserve Auction (LRCAP) to deliver 253.3 MW of firm capacity to the National Interconnected System.

The contract structure assigns Dongfang responsibility for engineering, technical supervision, and supply of the Francis turbine and generator equipment. CGGC will handle onsite assembly and installation of the new unit. The consortium was selected through a competitive bidding process that evaluated technical capability and adherence to budget parameters. Commercial operation of the seventh unit is scheduled for 2030.

Beyond the main equipment contract, SPIC Brasil has engaged Brazilian engineering firm SEEL for civil works, Tractebel Engineering for owner’s engineering services, and Egis Group for environmental management. This multi-contractor structure distributes project execution across specialized capabilities while maintaining local content in key work packages.

CEO Adriana Waltrick characterized the expansion as the most efficient pathway to increase renewable generation capacity in Brazil, emphasizing asset optimization over new construction. The strategy reflects broader industry trends toward upgrading existing hydropower facilities rather than developing new sites, which face longer permitting timelines and higher environmental scrutiny.

Dongfang Electric Brazil CEO Li Yage stated the Francis turbine technology selected for São Simão has been deployed in hundreds of global projects, positioning the equipment supply as low technical risk. CGGC Brazil CEO Ricardo Shang noted the company’s established track record in Brazilian infrastructure projects and confirmed mobilization of specialized installation teams.

The São Simão expansion increases SPIC Brasil’s operational portfolio to approximately 5.6 GW of installed capacity across Brazil. The project exemplifies the LRCAP mechanism’s role in incentivizing capacity additions at existing facilities, providing revenue certainty through long-term capacity contracts. The firm capacity model compensates generators for availability rather than energy dispatch, aligning with Brazil’s push to secure adequate reserve margins as intermittent renewable sources expand their grid share.