Technical Report - Brazilian Electricity Auctions in 2017

In December 2017 the contracting of energy from new power generation plants in Brazil was resumed, with two auctions that took place under the guidelines of the Ministry of Mines and Energy (MME). On the 18th, the "A-4" auction was conducted, for supply to begin in January 2021, while on the 20th it was time for the "A-6" auction, for energy supply to begin in January 2023 . 

Such auctions are part of the electricity supply adequacy mechanisms in Brazil. They have the objective of supplying the regulated market, providing long term energy contracts for power generators, that must be backed by firm energy. 

These two auctions were relevant because they have consolidated a couple of features that had been tested in previous years, such as a preliminary phase of competition for the available capacity in the transmission grid. At the same time, they were useful for promoting, successfully, a number of new features, such as a new auction systematic (or "mechanism"), stricter qualification requirements and changes in the production obligation rules for wind and for the must-run limits of thermal power plants.  

In the report below we describe the most relevant aspects regarding the two auctions held in December 2017 for contracting energy from new power plants, the role of EPE and bring insights on how the results are likely to influence the energy planning studies in the country.

Report - Electricity Auctions

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