* China's Three Gorges to pay $3.66 bln to run two large plants
* Brazil's Cemig to pay $586 mln to run 18 smaller installations
* Auction seen as important for Brazil's government accounts (Adds final numbers for auction, comments from subsidiary CFO)
By Luciano Costa and Marcelo Teixeira
SAO PAULO, Nov 25 (Reuters) - Brazil sold operation rights for all the existing hydropower plants it offered to power companies and investors in an auction on Wednesday for 17 billion reais ($4.51 billion), taking an important step to reorganize the power sector and to boost its accounts before the year ends.
The Brazilian government promoted the auction to find new operators for 29 hydropower installations with expired or nearly expired licenses, aiming also to raise crucial revenue for its depleted coffers amid a harsh fiscal adjustment.
From the total 17 billion reais to be paid by the auction's winners, 11 billion reais should enter the state coffers in December, said Jose Jurhosa, a director with the sector regulator Aneel.
Power sector experts said before the auction that the round would hold attractive assets, but regulatory uncertainties could hamper investors' interest.
Power company China Three Gorges Corp was the star participant in the round after agreeing to pay 13.8 billion reais to run the two largest dams on offer.
China's Three Gorges will take control of the Jupiá and Ilha Solteira dams, currently being operated by Brazil's Cesp , which was willing to keep the installations but acknowledged before the auction it lacked financing for it, reflecting the tight credit conditions in the country.
Jupiá and Ilha Solteira have a combined installed capacity of almost 5,000 megawatts. Three Gorges would be entitled to receive annual revenue of 2.38 billion reais during the 30-year contract, a sum that is subject to periodic reviews.
João Meirelles, chief financial officer of local subsidiary China Three Gorges Brasil Energia Ltda, said the size of the two installations was a determining factor for the company.
"It is basically the same DNA the company has in China, of operating very large hydropower plants," he said.
Brazil's regional utility Companhia Energetica de Minas Gerais was also a standout in the auction, after agreeing to spend 2.21 billion reais for the operation rights for 18 hydropower plants.
Cemig, as the company is known, said it is evaluating an offer of a credit line from a pool of banks led by Banco do Brasil to help it finance the deal.
The company's president, Mauro Borges, said the operation will allow Cemig to consolidate as the largest, integrated power company in Brazil.
Local power companies Celg and Companhia Paranaense de Energia, as well as Italy's Enel Green Power , also bought licenses for smaller plants.
$1 = 3.767 Brazilian reais Editing by Chizu Nomiyama, Jeffrey Benkoe and Jonathan Oatis