Private sector energy auctions have become a trend

Since 2005, the federal government has been commanding auctions to expand energy supply. However, recently, the so-called trading sessions scheduled by companies have been standing out. Last month, two auctions to hire wind and solar power plants in Brazil generated dispute among investors over long-term contracts.

The Ministry of Mines and Energy has decided to suspend this year's auctions for new plants indefinitely, due to the impacts of the Covid-19 pandemic. With this, private companies such as Copel and Sustainable Energy of Brazil (ESBR) bought energy in terms of more than 10 years for these trading sessions. Copel's auction moved 595 megawatts (MW), while ESBR's auction involved 170 MW. These are small numbers compared to those that are handled in those organized by the government, such as those in 2014 that moved 7 gigawatts (GW), but are inserted in a context of less opportunity for investments.

With the new MP of the electricity sector proposed by the government, which proposes to phase out some subsidies for renewable plants, these auctions become even more attractive to electric, who can buy energy with these incentives before they end.

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