Regulation of electricity utilities – sales of power

Approval to sell power

What authorisations are required for the sale of power to customers and which authorities grant such approvals?

Sale and purchase of power shall involve agents that are concessionaires or permissionaires and authorised for generation, commercialisation companies, importers, exporters and free or special consumers.

The commercialisation activity may be carried out only upon obtaining the necessary authorisation from ANEEL and adherence to CCEE in accordance with applicable regulations. Import and export activities shall also be subject to authorisation of the MME.

Power sales tariffs

Is there any tariff or other regulation regarding power sales?

Power sales in the SIN shall occur either in the ACR - between the applicable generation agents and distribution companies, or in the ACL - between generation or commercialisation agents, importers, exporters and free or special consumers.

The price in the ACR is determined by the applicable auction, while the price in the ACL is freely negotiated by both parties, with due regard to certain commercialisation rules and proceedings.

The tariff charged by distribution companies shall be subject to periodical adjustments and revisions based on ANEEL regulations.

Rates for wholesale of power

Who determines the rates for sales of wholesale power and what standard does that entity apply?

The price in the ACR is determined by the applicable auction conducted by the government, whereby sellers compete by the lowest bid price per MWh and observe specific terms and conditions established by applicable legislation and auction rules, as discussed above.

Public service obligations

To what extent are electricity utilities that sell power subject to public service obligations?

Distribution companies are subject to public service obligations, including: to render adequate services for full requirements of users, as established by law, applicable rules and the respective contract; and to provide regular, continuous, efficient, safe, up-to-date general services rendered courteously under moderate charges.

Free consumers that exercise the option to purchase power from other suppliers, rather than the applicable distribution company, may return to the distribution company and be subject to a regulated tariff, provided that such free consumers shall provide a five-year advance notice to the concessionaire, permissionaire or authorised distribution company, except if such term is reduced by the distribution company.