Brazil's Energy Research Office (EPE) released, on October 16, 2026, the Instructions for Requesting Registration and Technical Qualification of Hydraulic Energy Storage Systems (SAH). The document defines how these projects must submit documentation and which requirements they must meet to be analyzed by EPE with a view to participating in power sector auctions. For those developing battery projects (BESS) in Brazil, the publication deserves attention: it organizes the entry of another storage technology into the same competitive environment.
What the instructions establish
According to EPE, the material brings together the core guidelines for pumped hydro storage projects to go through registration and technical qualification. The topics covered include:
- AEGE System: guidance on filling in information on the platform EPE uses to receive registrations of projects bidding in auctions.
- Technical documentation: how to present the engineering studies and data that support the project.
- Environmental documentation: the licensing documents required for the analysis.
- Grid access documentation: proof related to the project's connection to the grid.
- Technical characterization: the description of the project's characteristics that underpin the assessment.
EPE states that the goal is to bring more clarity and standardization to the required information, facilitating the technical analysis of projects that intend to compete in future auctions. The company also opened a channel for questions, suggestions and contributions on the text, via the email aege@epe.gov.br.
Why this matters for energy storage in Brazil
Hydraulic storage systems, known as pumped storage hydropower plants, work in a conceptually simple way: when there is surplus energy, they pump water to an upper reservoir; when the system needs power, they release that water through turbines. It is a way of shifting energy in time, a function similar to that performed by batteries, albeit with different profiles in terms of size, deployment time and discharge duration.
EPE describes the publication as another step in preparing SAH to participate in auctions. In practice, this means the qualification process for this technology is starting to gain the same formality other sources already have. A standardized registration procedure reduces uncertainty for developers and for the planning body itself, which begins to receive comparable data across projects.
The announcement does not provide auction dates, registration deadlines or the format of the auction in which SAH would compete. Nor does it detail whether the requirements will be the same as or different from those applicable to batteries. These points depend on future acts.
What this means in the Northeast
Grid connection is one of the items the instructions require to be documented, and that is precisely where competition between storage technologies tends to materialize. In an ENLACE survey of Northeast substations eligible for LRCAP 2026, cross-referencing the ONS technical note on connection margin, we identified 14 substations in Bahia, 10 in Ceará and 6 in Piauí with a margin of 500 MW or more. This capacity is significant but finite, and any technology qualified for auctions could, in theory, compete for the same access points.
Therefore, for those developing BESS in Ceará, Piauí and Bahia, the arrival of qualification rules for pumped hydro storage reinforces the importance of securing grid access documentation early and monitoring how grid planning will accommodate different storage solutions.
Our take
In our assessment, the publication signals that sector planning is treating storage as a set of technologies rather than a single solution. For the battery market, this is both a sign of maturity and a warning: storage is firmly on the auction agenda, but batteries will not be alone. We see standardization as positive for the entire segment, because clear rules tend to attract better-prepared projects and bring predictability to the analysis.
There are still open questions. The source does not define which auction SAH will enter, nor whether they will compete directly with batteries for the same product or in separate segments. It is also unknown how technical criteria, such as discharge duration and deployment time, will be handled when comparing technologies. If the requirements are designed without considering these differences, distortions could occur in either direction, and it is too early to say who would be favored.
In the coming weeks, it is worth following the contributions sent to EPE through the open channel, any adjustments to the document and, above all, the acts that will set registration deadlines and auction dates. We also recommend watching whether equivalent instructions or revisions for battery systems emerge, which would allow a direct comparison of requirements.
What changes in practice for the BESS value chain
- Developers: should factor pumped hydro storage into their competitive mapping and get their grid access, environmental and technical documentation in order early, as it tends to be required in an increasingly standardized way.
- EPCs: need to be ready to support clients with detailed and consistent technical characterization, since the quality of information weighs on qualification.
- Manufacturers: have reason to strengthen technical arguments that set batteries apart, such as modularity and speed of deployment, in an environment where another technology will also be seeking room.
- Suppliers and service providers: connection studies, licensing and grid access engineering should remain in demand, as they are common requirements across different storage solutions.
In short, EPE did not change the rules for batteries, but it took a step that changes the context in which they compete. Following how this process evolves is part of the job for anyone who wants to arrive prepared for the next auctions.
Original source: EPE — EPE publica Instruções de Cadastramento para Sistemas de Armazenamento Hidráulico de Energia
Julio Martinez