VELCAN HOLDINGS: ANNUAL RESULTS 2020 - STABLE FINANCIAL RESULTS BUT
DECREASE OF THE NET INCOME
t
PRESS RELEASE
Luxembourg, 30th April 2021
VELCAN HOLDINGS: ANNUAL RESULTS
2020
STABLE FINANCIAL RESULTS
BUT DECREASE OF THE NET INCOME DUE TO DISAPPOINTING
OPERATIONS IN BRAZIL AND INDIA
NON AUDITED KEY CONSOLIDATED FIGURES |
2020 |
2019 |
Var % |
Revenues (EUR m) |
2.5 |
2.8 |
-12% |
EBITDA (EUR m) |
-2.0 |
-1.4 |
-45% |
Net Income (EUR m) |
2.1 |
3.6 |
-41% |
Shareholders’ Equity (EUR m) |
116 |
121 |
-4% |
Cash and Financial assets |
105 |
103 |
+1% |
Velcan Holdings Group closed 2020 with a net
result, Group share, of EUR 2.1m compared to EUR 3.6m in 2019. This
decline essentially stems from, on one hand a drop of the Brazilian
operational result due to a very low generation coupled with a
massive depreciation of the Brazilian currency and on the other
hand an increase of the impairment of the Indian projects, leading
to an overall decline of the result. The EBITDA is also down by 45%
(EUR -2.0m in 2020 vs EUR -1.4 m in 2019). Net financial gains,
which amounted to EUR 7.7m, were almost stable compared to EUR 8.1m
in 2019, mostly because of the reallocation of the portfolio from
corporate bonds to equity and commodities. Shareholder’s equity
decreased by 4% mainly due to the share buyback programs executed
in 2020 (492 k shares bought back in 2020, for a total price of EUR
3.1m).
During 2020, the Velcan Holdings Group continued
developing its hydropower concessions located in India (571 MW),
and operated its Rodeio Bonito hydropower plant (15 MW) in Brazil.
The uncertainties and deadlocks of the Indian hydropower market
remained, as in 2019, and prevented progress of the projects,
leading to an additional provision or Eur 2.8 million (20%) for FY
2020 on the intangible value of the Indian projects. This brought
the total provision to Eur 7.1 million (50%), considering the
previously booked provisions. This additional provision was already
accounted for in the 2020 half yearly results published in October
2020.
The Rodeio Bonito plant generation was
historically low, 40% below the 2019 generation, as a result of the
severe draught in the south of Brazil which led to an increase of
the payments to the MRE system1. At constant foreign exchange rates
the turnover has grown (+18%) thanks to the inflation of selling
prices. In Euro the turnover is down by 12% (EUR 2.5 m in 2020 vs
EUR 2.8 m in 2019) because of the massive depreciation of the
Brazilian currency in 2020 (-41%).
FINANCIAL YEAR
2020 – MANAGEMENT COMMENTS ON THE
BUSINESS
India
The hydroelectric concessions obtained in 2007
in the State of Arunachal Pradesh could not make significant
progress, due to several long lasting administrative and regulatory
impediments, aggravated by the Covid-19 pandemic. The
Techno-Economic Clearance (TEC), Environmental Clearance, Forest
Clearance as well as most of the post TEC investigations being
complete for the tandem Heo-Tato-1 (426 MW), the main next
development steps for these 2 projects are the land acquisition,
the transport infrastructure, the amendment of the concession
agreements, the stage 2 Forest Clearance and the preliminary search
for a bankable Power Purchase Agreement (PPA). These steps however
essentially fall under the purview and responsibility of the State
and Central Governments.
During 2020 the land acquisition procedure
conducted by the State Government was halted due to a stoppage of
the land survey by several land owners who physically prevented the
District administration to enter some parts of the land,
complaining about land ownership disputes and claiming immediate
financial compensations. The discussions initiated between the
state government and the concerned owners in February 2020 were
suspended due to the Covid-19 outbreak, as the required meetings
could happen only physically. The procedure could restart only in
February 2021. All the on-site surveys and boundary markings were
completed by the District Administration in March 2021, without
interruption. As of the date of this press release, the Group has
not received the official survey report and list of land owners
from the District Administration. However the Group’s team attended
each survey and it is the Group understanding that significant
parts of the land requirement have again been registered by the
District Administration as being under ownership dispute, and that
the survey may lead to an increase of disputed areas as compared to
earlier lists established by the State Government. The Group does
not know yet if and how the Government of Arunachal Pradesh (GoAP)
will settle these disputes and find a solution that will allow
permanent site access and the Projects’ implementation.
VELCAN HOLDINGS considers that, as per the
current concession agreement and applicable regulations, the land
acquisition process and ownership disputes settlement are the
exclusive responsibility of the licensing Government. The
concession contract provides for an extension of the development
period in case of any delay which is not the responsibility of the
developer. Negotiations with the GoAP, for the amendment of the
concession agreement, relate to the development timeframe, but also
to the amendment of the allocated capacities (still 380MW in the
current concession agreement) and other important terms, have not
progressed since 2018.
This has led to the impossibility to renew the
TECs of the Heo and Tato-1 (426 MW) tandem in 2020, as such
renewal required either a concession agreement up to date with the
426 MW capacity approved by CEA, or a non-objection certificate
(NOC) from the GoAP. TECs of Heo and Tato-1 HEP, granted in 2015
for 3 years and already extended a first time in 2018 for 2 years,
were bearing validities until on 27th July 2020 and 28th October
2020 respectively. Applications for renewals of both TECs were
submitted to CEA, which requested the Group to obtain from GoAP a
(NOC) acknowledging that the GoAP has no objection to the renewal
of the projects TECs for the current capacities of 240 MW and 186
MW. After several discussions the GoAP refused, on 1st October
2020, to issue a NOC unless the concession agreements were amended
under conditions entailing significant financial costs, some of
which the Group does not agree with.
After requesting a draft amendment to the GoAP
during Q4 2020, without success, the Group finally sent its own
proposed draft amendment in Q1 2021. Its main provisions relate to
the allocated installed capacities, the administrative fees, the
development timeframe, the obligations of both parties, and the
increase of the free power to the GoAP against the withdrawal of
its potential equity participation in the projects. The provisions
have been proposed by the Group considering the historical
difficulties and the ground reality of the projects and of the
Indian hydropower market. As of the date of this press release, the
discussions are going on with the GoAP, but both TECs of Heo and
Tato-1 HEP are technically not valid anymore, and their renewal is
depending on the execution of the revised concession agreement (in
addition to the CEA renewal procedure).
The road infrastructures have kept progressing
at a slow pace during 2020 as they did in previous years. No
progress has been made by the Government of India regarding the
acceleration of the overall completion schedule. The scheduled
dates of completion of the roads upgrade up to the projects site
are still scheduled theoretically in 2022, but will most likely
face significant delays of 2 to 3 years given that for some
stretches the technical studies have not yet even been completed.
On the forest clearance side, the renewal of the stage-I clearance
has been applied for in September 2020 and is still under progress
as of date.
The Group continued to explore the Indian market
and to conduct its preliminary search for a PPA during 2020. All
the major Indian power traders (PPA brokers) and distribution
companies (DISCOMS) contacted for Heo and Tato-1 either declined to
take up a commercial discussion for a PPA or did not respond. The
continued lack of appetite of the market for hydropower PPAs
results from the commercial and financial Indian market conditions,
which remained the same during 2020 and still do not fulfil the
requirements for the long term and bankable sale of hydropower. The
market remained constrained by the lack of appropriate regulatory
framework for such bankable PPAs, the stressed financial position
of electricity distribution companies (DISCOMS) and the indirect
competition of cheap solar and wind power. Grid stability and the
requirement for peak power2 have also become a growing issue for
Run-of-the-River (ROR, hence with no storage) hydro projects such
as Heo and Tato-1 HEPs.
Two years after the announcement of the new
hydropower policy by the Government of India, a first part of the
long awaited implementation regulation has finally be issued,
imposing a Hydropower Purchase Obligation (HPO) on DISCOMS, setting
a percentage of power that shall be procured by them from
hydropower sources between 2021 and 2030. These percentages range
from 0.18% to 2.82% and are remarkably lower than those of solar
power, currently at 10.25% for 2021. The question is raised within
the industry whether these provisions will be sufficient to trigger
a general revival of the hydropower sector and enough demand for
long term bankable PPAs for projects which are not yet under
construction.
Despite the above issues, the Group’s projects
are the only hydropower projects of such size in India owned and
developed by a foreign investor. They are amongst the most advanced
private projects and present competitive techno-economic and
environmental features.
Despite long term promising prospects, the
current Indian power market and especially the hydropower sector
are still characterized by a lot of uncertainties. The Groups’
projects have been heavily delayed several years in a row. These
delays and uncertainties have been reflected in an additional
provision of Eur 2.8 million (20% of gross value) decided for first
semester 2020 on the intangible value of the Indian projects. This
brought the total provision to Eur 7.1 million (50% of gross
value), considering the cumulated provisions booked in previous
years (EUR 4.4m or 30% of gross value).
The Indian projects activities have been
detailed in chapter I.4.1 of the annual report available at
http://www.velcan.lu/investors/reports-accounts/.
Brazil
The Rodeio Bonito Hydropower plant (15 MW)
recorded a historically low production of 29 496 MWh in 2020, 40%
below the 2019 generation (49 113 MWh in 2019) and close to its
all-time record low of 2012 (24 793 MWh). However the turnover when
expressed in the Brazilian currency (BRL) was up thanks to the
inflation and the MRE system. But as a result of this very low
electricity generation and the national low hydro generation in
2020, the plant had to compensate the MRE system, which was in a
negative position. This is why payments to the MRE were much
higher, reaching EUR 0.7m in 2020 vs. EUR 0.2m in 2019. As a result
the EBITDA of the plant amounted to BRL 8.1m against BRL 9.3m in
2019, down by 13%. When converted in euro, the EBITDA of the plant
was significantly lower to EUR 1.4m vs 2.1m in 2019 (-51%) mostly
due to a 34% depreciation of the average rate of the Brazilian Real
vs Euro currency in 2020.
Financial Assets
VELCAN HOLDINGS Group also continued to manage
actively its treasury throughout a complicated year marked by the
Covid-19 pandemic and its impact on the financial markets. The
Group executed an important reallocation of its investments in
other asset classes. The Group started the year with a portfolio
invested at approximately 60% in bonds, mostly high yield corporate
ones.
This bond portfolio was reduced by approximately
half in January and February, as the rewards seemed not any more
commensurate with the potential default risks. Since the March 2020
market crunch, the Group has gradually changed its asset allocation
to include more exposure to equity and commodities (mostly
gold).
As of 31st December 2020, the bonds exposure,
including T-bills, was reduced to 19% of the portfolio (64% as of
31/12/19), whereas the rest of the portfolio of cash, financial
assets and financial liabilities (EUR 104.5 m) included:
- a negative net cash position of EUR
9.3 m (-9% of the portfolio) versus a positive net debt position of
EUR 27.2 m in 2019 (25% of the portfolio),
- 19% of gold related exposure
(versus 1% as of 31/12/2019),
- 21% of oil related stocks (none as
of 31/12/2019),
- 4% of silver related stocks (none
as of 31/12/2019),
- 42% of equity (excluding oil) long
positions (7% as of 31/12/2019),
- 4% of equity short positions (2% in
2019),
- 1% in private equity and credit (3%
in 2019).
While reallocating its financial assets towards
equity, the Group has invested in companies which were trading at
historically low prices and could benefit from the improvement of
the Covid-19 situation. The two sectors hence selected were banking
and energy.
This strategy of reallocation of the financial
assets proved profitable as the Group net financial assets rose
from Eur 103 million to Eur 105 million and the financial result
amounted to EUR 7.7 m as of 31/12/2020, stable when compared to
2019 (EUR 8.1 m) and despite the COVID-19 crisis.
Given the current very low levels of benchmark
rates in all developed markets (USA, Europe and Japan), the Group
does not anticipate it will increase again its investments in
corporate bonds in the medium term.
The Group has reduced significantly its
financial exposure to the USD and increased its exposure to the
Euro and the Japanese Yen. As of 31/12/2020 the Group financial
assets were exposed notably to the US Dollars (35% against 67% in
2019), the Japanese Yen (25% against 2% in 2019) and the Euro (22%
against 9% in 2019). It is to be noted that the Gold and Silver
positions are priced in USD and as such are included in the former
USD exposure.
Contrary to the previous years, the Group has
fully invested its cash and has used some leverage (see above / net
cash position)
The financial portfolio is detailed in part I,
section 3.1.B of the annual report 2020 available at
http://www.velcan.lu/investors/reports-accounts/.
During the year Velcan Holdings continued to
execute buyback programs in order to provide liquidity to
shareholders wishing to sell their shares. The shares are bought
back in view of their cancellation or to cover for new grants of
free shares. A total of 492,348 shares were bought back in 2020,
for a total price of Eur 3,131,696. 275,000 shares were cancelled
in April 2020 and, as of 31st December 2020, Velcan Holdings held
314,023 own shares representing 5.66% of its share capital.
Foreseeable evolution of the
Group:
After the closing of this financial year, the
Group is pursuing the following main objectives as a priority for
FY 2021:
- Pursuing the development of the
Indian hydropower projects.
- On the short term, executing the
required amendment to the concession agreements of the Indian
hydropower projects, in order to secure the renewal of the TECs and
the renewal of Forest clearances.
- Continue the active management of
its diversified financial investments;
The ability of the Group to pursue these
objectives is subject to the evolution of the current Covid-19
crisis, which may affect both the development of the Indian
projects and the financial portfolio.
FINANCIAL YEAR
2020 – MANAGEMENT COMMENTS ON THE
UNAUDITED CONSOLIDATED FINANCIAL
STATEMENTS
Income Statement (unaudited
consolidated)
Turnover amounted to EUR 2.5m (against EUR 2.8m
in 2018, a 12% decrease), mainly from electricity sales in Brazil.
The turnover in local currency increased by 18% with the inflation
on electricity sale prices. However, the depreciation of the
Brazilian currency vs the Euro currency was responsible for a 34%
decrease of the turnover in Euro.
The current operating result amounted to EUR
-5.6m (against -4.3m in 2019):
- Payments to the MRE (Energy
Reallocation Mechanism) were EUR 0.7m in 2020 vs. EUR 0.2m in
2019.
- Depreciation and amortization of
tangible and intangible assets of Rodeio Bonito plant amounted to
EUR 0.5m (EUR 0.7m in 2019), while depreciation on intangible
projects under development was EUR 2.8 vs an amount of EUR 2.2m in
2019, due to the provision passed on Indian projects.
- Staff expenses amounted to EUR 2.7m
in 2020 vs EUR 2.6m in 2019. The Group employed on average 20
permanent employees in 2020.
- External expenses are totaling EUR
1.4m in 2020 vs EUR 1.5m in 2019.
Net Financial Gain for the group amounted to EUR
7.7m in 2020 mostly because of the reallocation strategy from bonds
to equity and commodities markets and despite the USD depreciation
(-9% compared to end of 2019) and its impact on the Group’s cash
and financial assets position. The impact of this depreciation has
been managed by the currency reallocation strategy of the Group,
avoiding bigger potential forex losses (see breakdown per currency
in chapter I.7.4. of the annual report). This gain of 7.7m compares
to EUR 8.1m in 2019.
In 2020, other operating income (EUR 0.2m)
consisted mainly of earn out gains on Brazilian assets related to
Brazilian assets divested in previous years. This figure was NIL in
2019.
Income tax expense amounted to EUR -0.2m in
2020, same as in 2019.
The net result, Group share, was EUR 2.1m in
2020 FY compared to EUR 3.6m in 2019.
The Group’s EBITDA reached EUR -2.0m compared to
EUR -1.4m in 2019.
The strong depreciation of BRL (-41%) and INR
(Indian Currency -12%) closing rates when compared to Euro, at 2020
closing date, has heavily and negatively impacted the other
comprehensive income, as the Group’s main tangible and intangible
investments have been done in local currency (EUR -4.5m in 2020
against EUR -0.1m in 2019). The total comprehensive income amounts
to a loss of EUR -2.4m in 2020 against a gain of EUR 3.5m in
2019.
Balance sheet
– Assets (unaudited
consolidated)
Net intangible assets stands at 8.3m in 2020 and
are down by EUR 3.7m versus 2019, mostly because of the provision
of EUR -2.8m of Indian assets, the depreciation of the Indian
currency (EUR -0.9m) and the Brazilian currency (EUR -0.5m) despite
the addition of EUR 0.7m of capitalized costs on Indian
projects.
Net tangible assets stands at 5.3m in 2020 and
decreased by EUR 2.7m between 2019 and 2020, mainly because of
depreciation of the Rodeio Bonito plant (EUR -0.5m) and the
depreciation of the Brazilian currency (EUR -2.3m).
Cash, cash equivalent assets and financial
assets (net of Current financial liabilities) have increased from
EUR 103m in 2019 to EUR 105m in 2020 (+1%) mainly thanks the good
performance of the Group’s financial portfolio and despite the
share buyback programs. Financial assets consist mainly in listed
equity, bonds and commodities related stocks.
Finally total assets increased by 15.3% during
2020 FY (up by EUR 18.9 m), mostly because of the bank overdraft
facility described in below as part of the “liabilities” and the
related asset purchases.
At 31st December 2020, the Group (Velcan
Holdings and its subsidiaries) holds 314,023 own shares (2019:
146,810). At year end closing price of EUR 6.41 those own shares
have a market value of EUR 2.0m.
Balance sheet
– Liabilities (unaudited
consolidated)
Non-current provisions and other non-current
liabilities amount to EUR 0.7m and EUR 1.0m at 31 December 2020
respectively and arise from litigations related to the 2 biomass
plants previously owned by the Group (Satyamaharshi SMPCL – 7.5 MW
and Rithwik RPPL – 7.5 MW, owned between 2006 and 2010). The
existing provision represents the major part of the claims as well
as accumulated interests and judicial expenses.
Trade and other payables amount to EUR 0.9 m vs
EUR 0.5m in 2019 (due to EUR 0.3 m of payable related to MRE
payments in Brazil, due in early 2021 but related to 2020
generation).
Current financial liabilities of EUR 23.9 m in
2020 (vs NIL in 2019) are related to overdraft facilities granted
by a brokerage firm to the Group to leverage its listed investments
trading activities. Under this facility, securities held in the
trading account are used as a security to borrow money. This
facility has enabled the Group to leverage its investments and
maximize its profits. But it is to be noted that leverage works
both ways and could also cause higher losses in case of fall in
market prices.
Own shares, booked directly against the equity
of the Group at their historical cost, reduce the net shareholder’s
equity of the Group by EUR -2.1m at 31st December 2020 versus EUR
-1.2m at 31st December 2019 following the share buyback programs
(EUR -3.1m), the capital reduction (EUR +1.9m) and the use of
shares to cover share based payments (EUR +0.4m).
As at 31st December 2020, unrealized losses on
conversion reserves, booked directly against the equity amounted to
EUR -14.2m versus an unrealized loss of EUR -9.6m at 31st December
2019, as the BRL and INR currencies heavily depreciated VS EUR
currency in 2020.
With a consolidated equity of EUR 115.8m (-EUR
5.3m compared to 2019), the Group still has no significant net debt
as of 31st December 2020, though it should be noted it uses
leverage (cf. the leverage facility mentioned earlier).
The full annual report
2020 is available at:
http://www.velcan.lu/investors/reports-accounts/
SUMMARY
CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Balance
Sheet
ASSETS (EUR ’000) |
2020 |
2019 |
NON-CURRENT ASSETS |
14 375 |
22 946 |
Intangible Assets |
8 256 |
11 923 |
Tangible Assets3 |
5 315 |
8 023 |
Non-Current Financial Assets |
805 |
3 000 |
Other Non-Current Assets |
- |
- |
CURRENT ASSETS |
128 060 |
100 547 |
Current Financial Assets |
115 946 |
72 854 |
Cash and Cash Equivalents |
11 673 |
27 168 |
Other Current Assets |
440 |
525 |
TOTAL ASSETS |
142 435 |
123 493 |
LIABILITIES (EUR ’000) |
2020 |
2019 |
Equity (Group Share) |
115 819 |
121 088 |
Minority interests |
0 |
0 |
TOTAL EQUITY |
115 819 |
121 088 |
NON-CURRENT LIABILITIES |
1 662 |
1 839 |
CURRENT LIABILITIES |
24 954 |
566 |
Bank overdrafts |
23 918 |
- |
TOTAL LIABILITIES |
142 435 |
120 647 |
Income Statement (EUR
’000) - Unaudited
|
2020 |
2019 |
Revenues |
2 517 |
2 846 |
Operating expenses |
(4 772) |
(4 246) |
Amortizations, depreciations and Provisions |
(3 349) |
(2 876) |
Ordinary Operating Result |
(5 604) |
(4 277) |
Other operating Income |
233 |
9 |
Operating Result |
(5 371) |
(4 268) |
Net Financial Income (Loss) |
7 711 |
8 108 |
Tax Income (Expense) |
(220) |
(244) |
Income – Minority Share |
0 |
0 |
Net Income – Group Share |
2 119 |
3 596 |
EBITDA |
(2 022) |
(1 392) |
- Audited statutory statements next page
SUMMARY AUDITED STATUTORY FINANCIAL
STATEMENTS (Lux
Gaap)
Balance Sheet
ASSETS (EUR ’000) |
2020 |
2019 |
FIXED ASSETS |
146 574 |
150 492 |
CURRENT ASSETS |
58 778 |
6 565 |
Debtors |
44 |
73 |
Investments |
57 831 |
4 916 |
Cash at bank and in hands |
904 |
1 576 |
PREPAYMENTS |
47 |
43 |
TOTAL ASSETS |
205 399 |
157 101 |
LIABILITIES (EUR ’000) |
2020 |
2019 |
CAPITAL AND RESERVES |
111 813 |
119 527 |
CREDITORS |
93 587 |
37 574 |
TOTAL LIABILITIES |
205 399 |
157 101 |
Income Statement (EUR
’000)
|
2020 |
2019 |
Gross profit or loss |
(1 457) |
(859) |
Value adjustments |
- |
- |
Income from other investments & loans forming part of the fixed
assets |
1 700 |
537 |
Other interest receivable and similar income |
532 |
3 |
Value adjustments in respect of financial assets and of investments
held as current assets |
(3 852) |
1 510 |
Interest payable and other similar expenses |
(2 737) |
(164) |
Tax on profit or loss |
(9) |
|
Other taxes |
(5) |
(5) |
Profit or Loss for the financial year |
(5 829) |
1 022 |
* * *
Investor Relations
Contact investor@velcan.lu
About Velcan:
Velcan Holdings is a Luxemburg headquartered
investment holding company founded in 2005, operating as an
independent power producer in emerging countries and managing a
global portfolio of financial assets.
The company owns and operates a 15MW hydro power
plant in Brazil that it developed and built in 2009. The company is
developing a cascade of hydropower concessions located in India and
totalling 571 MW.
Hydropower concessions provide long periods of
cash generation but their development outcome is uncertain and many
years are needed to bring these projects to maturity in emerging
countries: it involves field studies in remote places, obtaining
the necessary authorizations and permits, and land acquisition in
political and regulatory environments that can be unstable or
heavily hampering. Meanwhile Velcan Holdings actively manages its
treasury, investing in listed and unlisted financial
instruments.
Velcan Holdings’ headquarters are in Luxemburg,
with administrative and financial offices in Singapore and
Mauritius. The team dedicated to the development of the Indian
hydropower cascade is based in New Delhi and at the project site
(Arunachal Pradesh). The team dedicated to the Rodeio Bonito plant
is based in Sao Paulo and Chapeco (Santa Catarina State).
The company was launched more than 15 years ago
by its reference shareholder Luxembourg Hydro Power SA, owned by
Velcan Holdings’ management team.
Velcan Holdings is listed on the Euro MTF Stock
Market in Luxembourg (Ticker VLCN/ISIN FR0010245803).
Velcan Holdings never performed any Public Offer
as understood under Directive 2003/71/CE of the European Parliament
and Council.
Disclaimer
This press release contains prospective
information about the potential of the projects in progress and/or
of the projects of which the development has begun. This
information constitutes objectives attached to projects and shall
not be construed as direct or indirect net income forecast of the
concerned year. Reader’s attention is also drawn on the fact that
the performance of these objectives depends on future circumstances
and that it could be affected and/or delayed by risks, known or
unknown, uncertainties, and various factors of any nature, notably
related to economic, commercial or regulatory conjuncture, which
occurrence could be likely to have a negative impact on future
activity and performances of the Group.
This announcement does not constitute a public
offering (“offre au public”) nor an invitation to the public or to
any qualified investor in connection with any offering. This
announcement is not an offer of securities in the United States of
America or in any other jurisdiction/country.
1 Energy Reallocation Mechanism system which
involves payments from the generators when the overall system is in
deficit. (Energy Reallocation Mechanism, definition and explanation
in chapter I.4.2 of the annual report)2 So-called "peak"
electricity is supplied during a peak in electricity consumption,
when the consumption of an electricity network is the highest for a
defined period (usually specific hours of the day), and must
therefore be guaranteed for a given schedule.3 Almost exclusively
constituted of the Rodeio Bonito Hydro Power Plant asset
- 2021.04.30 Velcan Holdings 2020 Results