Brazil's Ministry of Mines and Energy (MME) has signaled that the Capacity Reserve Auctions in the form of Storage Power (LRCAP), scheduled for December 2 and 4, should stay on the calendar. The assurance was given at a videoconference meeting held on Wednesday, July 22, between ABSOLAR and the MME's new National Secretary for Energy Transition and Planning, Mariana Espécie. The association was represented by its Executive President, Rodrigo Sauaia, and the leaders of its energy storage area. In addition to the auctions, the agenda included MME Normative Ordinance No. 140/2026, which set the rules for compensating renewable generation curtailment.
LRCAP schedule preserved
The LRCAP is the mechanism through which the government contracts available power to provide security to the electricity system. In the storage modality, contracting focuses on battery energy storage systems (BESS), which can store energy and return it to the grid when it is most needed, functioning as a capacity reserve.
According to the account of the meeting, the ministry reaffirmed its commitment to holding the auctions on the planned dates. This matters because there is a parallel discussion on repealing § 6 of Art. 3-A of Law No. 10,848/2004, a provision added by Law No. 15,269/2025. This provision requires that the costs of batteries contracted as capacity reserve be shared only among generation agents. According to the MME, this debate should not interfere with the auction calendar.
Who pays for the batteries: the open debate
How costs are allocated is a sensitive issue for the entire sector. When the bill for the capacity reserve falls exclusively on generators, the impact is concentrated on a single segment, which explains the mobilization around the possible repeal of the provision. The ministry's message, however, separates the two agendas: the discussion on the cost-allocation rule can run its course without stalling the contracting.
For those following the storage market in Brazil, this separation removes an important source of uncertainty, since date changes usually affect negotiations with suppliers, financiers, and engineering partners.
Compensation for generation curtailment
The second topic of the meeting was Normative Ordinance No. 140/2026, which deals with compensation for renewable generation curtailment that occurred between September 2023 and November 2025. On this matter, the MME indicated that the methodology for calculating the physical guarantees of plants affected by the restrictions will need to be updated. Only after this review should the methodology be submitted to Public Consultation.
Physical guarantee generally corresponds to the amount of energy a plant can sell based on its production capacity. Therefore, any adjustment to this calculation has a direct effect on the revenue and valuation of the affected projects.
ABSOLAR stated that it continues to work with the Legislative, Executive, and Judicial branches to contribute to public policies for the solar photovoltaic sector.
What changes in practice for the BESS market
The main takeaway is continuity: there is no sign of postponement, and planning should continue with December as the reference. For the different links in the chain, this means:
- Developers: keep up the pace of project preparation, documentation, and bidding strategy, without counting on extra slack in the calendar.
- EPCs: continue structuring technical and execution proposals aligned with the deadline of the December 2 and 4 auctions.
- Battery manufacturers and suppliers: sustain commercial negotiations and supply scheduling based on the confirmed dates.
- All agents: follow the discussion on cost allocation under Law No. 10,848/2004 and the upcoming public consultation on physical guarantee, as both may change economic assumptions, though not the schedule.
In short, the scenario calls for continuous preparation and attention to the regulatory changes running in parallel with the auctions.
Original source: ABSOLAR — ABSOLAR debate armazenamento de energia com a nova Secretária Nacional de Transição Energética e Planejamento do MME