As competition is introduced to improve business efficiency, state-owned electricity utilities in South America are gradually restructuring to fall in line with the worldwide transformation of the industry with unbundling of services and the creation of energy markets. Coinciding with this culture change is the growth in demand for electrical energy, which threatens to outstrip installed generating capacity. Although the land mass is rich in energy resources, in general, these are located away from the centers of population. Therefore, there is a need for bulk energy transmission — often over long distances that must be routed through rough terrain and environmentally sensitive areas. Currently, utilities are investing in several major projects to enhance the security, capacity and flexibility of existing transmission systems.

Bolivia

Transportadora de Electricidad obtained the approval of the Superintendencia de Electricidad, the Bolivian Energy Regulation Agency, to increase the voltage of the Vinto — Kenko transmission line from 115 kV to 230 kV. This line interconnects the northern part of the country with the rest of the system. A second project will increase the capacity of the existing Valle Hermoso Substation in Cochabamba with the installation of 230/115-kV transformers. These two projects will increase the capacity of the country's interconnected main system.

Brazil

One of the largest projects of power transmission built in Brazil during the past few years was handed over to Empresa Amazonense de Transmissã;o de Energia (EATE), the Amazon Energy Transmission Co. established by the companies Schahin and Alusa in March 2003. The new system, already in operation, interlinks a region with an enormous hydroelectric potential to generate energy to the system that supplies the remainder of Brazil. The 500-kV transmission line, constructed between Tucuruí and Presidente Dutra, is some 943 km (586 miles) long, links the existing substations in the towns of Tucuruí and Marabí, in the State of Parí, to the existing substations in Açailândia, Presidente Dutra and Imperatriz towns located in the state of Maranhã;o.

Chile

TRANSELEC, the main Chilean high-voltage transmission operator, awarded a consortium contract to reinforce the transmission grid. AREVA T&D is working on the project along with consortium partners, including the Japanese firm Mitsubishi Electric Co. (MELCO), to provide a full turnkey solution to transmit the electricity energy generated at the RALCO 570-MW hydropower plant in central Chile.

The scope of this project includes the construction of four 500-kV series capacitor systems (SCS), a new 500-kV/220-kV substation at Charrua, the expansion of two 500-kV substations at Ancoa and Alto Jahuel, the supply of 1500 MVA autotransformers, 500-kV reactors, a digital protection and control system and all related civil works, erection, testing and commissioning. By using SCS technology, TRANSELEC can increase the transfer capacity of it 500-kV transmission system, thereby avoiding the costly and time-consuming process of building new transmission lines. This project is scheduled for completion in the summer of 2004.

Mexico

The state-owned utility Comision Federal de Electricidad (CFE) in Mexico is now in a period of considerable investment to substantially increase the generation plant and the capacity of the transmission system. AREVA T&D recently completed two major turnkey projects for CFE worth US$54 million.

The first turnkey contract, the 410 National System project, was undertaken in conjunction with two Spanish contractors, Abengoa and Elecnor. AREVA T&D's part of the project comprised:

• Extension of Silao 230/115-kV substation located in the Guanajuato State, 350 km (218 miles) northwest of Mexico City

• Construction of a 400/115-kV substation at San Martin near the town of Puebla, 120 km (75 miles) east of Mexico City

• Construction of a 400/115-kV substation at Sabino, in Chiapas State in southern Mexico.

Venezuela

ENELVEN, a state-owned electric utility in Venezuela, awarded ABB a US$28 million contract to install systems that will increase the capacity of existing overhead transmission lines supplying the petroleum and petrochemicals center of Maracaibo by 20%. ABB offered the use of Flexible AC Transmission Systems (FACTS) — a number of technologies that increase the capacity and flexibility in ac power transmission — which would save ENELVEN from investing in the more expensive and time-consuming alternatives. Under the terms of this turnkey contract, ABB will design, build, install and commission five series compensation stations, one for each of the five existing 400-kV transmission lines. The project is on an accelerated 15-month schedule to provide ENELVEN with extra transmission capacity as quickly as possible. The project will make an additional 300 MW of power available to help meet growing demand for power in the Maracaibo region, and ENELVEN will benefit by gaining a substantial and almost immediate increase in available power, at around one-fifth the cost of adding new transmission capacity. Furthermore, the utility will defer major investment in additional transmission lines or new generating capacity.