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The Provisional Measure should be submitted by late June.

Soon any difference between free and captive power consumers may cease to exist. The government is drafting a Provisional measure (PM) to be submitted by late June. According to Valor Econômico, this measure will propose reinforcing the electric power sectors. The measure should continue to demand a minimum of 0.5 MW contracted demand to join the free market, but it is likely to eliminate any requirement that consumers with demands between 0.5 and 3.0 MW, the so-called special consumers, source exclusively from incentivized sources. This means anyone could purchase energy from any source.

The PM will also propose changes in how Brazil’s half of the Itaipu energy is traded. The draft should allow Eletrobras to sell this energy in both the free and regulated markets. This change would be effective as of 2023, the year the bilateral agreement that determines that Brazil’s share of Itaipu be split into quotas for distributors in the South, Southeast and Middle-West expires.

Another proposed change is being called the “de-quotization” of energy sourced from the hydro plants that opted for early renewal in 2012, as part of PM 579. With this change, plants will be able to sell their energy – previously set aside exclusively for distributors -, to other agents such as traders or large industrial consumers. “De-quotization” would also transfer the costs associated with hydrology risks, currently absorbed by consumers, to those who purchase or generate this energy.

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