On September 11, 2020, Law No. 1037, Law for the Reform and Addition of Law No. 532, Law for the Promotion of Electricity Generation with Renewable Sources and its reforms was published in The Gazette Official Daily No. 171, incorporating important transformations to the energy sector.
The purpose of this reform is to amend the price of the energy and to achieve a reduction in the of electric energy fees, through the following measures
- The prices of energy in the spot market sold by generators that do not have contracts with distributors were modified. In this sense, the minimum price of 5.5 cents per Kwh was eliminated and it was established that the price shall not be higher than 6.5 cents per Kwh.
- A transitory provision was created allowing renewable energy generators to negotiate the reduction of the prices agreed in their contracts (PPAs) with the distributors. The generators that reduce their prices will benefit from an exemption of income tax (IR) and the final minimum IR payment for a maximum additional period of five (5) years. In the case of geothermal generators, this maximum additional exemption period will be two (2) years.
The maximum date for applying for this benefit will be October 31, 2020.