The Ministry of Mines and Energy published, in an extra edition of the Diário Oficial da União on September 29, 2026, Normative Ordinance MME 143/2026, which establishes a multi-year calendar for the Capacity Reserve Auctions in the form of Power (LRCAP). The auctions are scheduled for 2027, 2028 and 2029, always in the second half of the year. The following day, the Brazilian Association of Energy Storage Solutions (ABSAE) released a favorable assessment of the measure, but once again pointed to a cost-allocation distortion that directly affects battery energy storage systems (BESS).
What the ordinance defines
The LRCAP is the mechanism through which the government contracts power availability to ensure supply during the periods of highest demand on the National Interconnected System, rather than energy itself. Until now, these procurements followed a more ad hoc logic. With the new ordinance, the market will know the window for each auction in advance.
- Scheduled years: 2027, 2028 and 2029.
- Period: second half of each year.
- Condition: holding each auction depends on the needs identified by the annual sector planning studies.
For ABSAE, the sequence of assessments and procurements makes it clear that demand for power is structural: peak supply, flexibility and operational security should remain at the center of planning in the coming years, and cannot be solved in a single auction.
Technology neutrality and the cost-allocation issue
In the association's view, the ordinance signals that power can be supplied by different solutions, chosen according to level of flexibility, delivery duration and time to start operation, with a technology-neutral analysis focused on lowest cost. This is precisely where the organization sees a contradiction.
Under the provisions of art. 3-A of Law 10.848/04, the costs of capacity solutions are shared between end consumers and generators. Batteries, however, would be paid for only by generators, a rule that, according to ABSAE, may undermine the expected neutrality. The association is calling for the repeal of § 6 of art. 3-A through the urgent approval of Bill PL 3716/26, so that capacity costs are allocated equally across all technologies.
The organization also advocates a division of roles: near-daily, short-duration deficits, under 4 or 6 hours, should preferably be met by flexible resources such as batteries, hydropower plants and demand response, while thermal plants would cover subsidiary and long-duration risks.
The figures presented by the sector
ABSAE cites a study by Volt Robotics according to which battery storage is well suited to short-duration, high-frequency situations, such as the evening peak. The study indicates fixed costs up to 60% lower than those of thermal solutions and a reduction in charges of up to 1.6 billion per year for consumers. The association adds that this portfolio helps reduce renewable energy curtailment, save water in reservoirs for the dry season and reduce thermal dispatch.
Executive director Fabio Lima stated that a three-year schedule gives developers and manufacturers the conditions to mature projects and consolidate capacity, and that the 2026 storage auction is part of building a long-term capacity market.
What changes in practice for BESS players
For developers, the main change is the ability to plan a staggered portfolio, distributing projects between the 2026 LRCAP-BESS and the 2027 to 2029 auctions, with more time for permitting, grid access and financial structuring. EPCs can size teams and schedules based on more continuous demand. Manufacturers and suppliers gain a signal to reserve production, negotiate supply contracts and evaluate a local presence in the country.
The point of attention is regulatory: as long as § 6 of art. 3-A remains in force, exclusive cost allocation to generators remains a source of uncertainty in competition with thermal plants. Monitoring the progress of PL 3716/26 and the annual planning studies, which condition each auction, should be part of the strategy of any company intending to compete in these auctions.
Original source: ABSAE — Calendário de leilões amplia previsibilidade, confirma necessidade contínua de potência e reforça importância do LRCAP-BESS em 2026, avalia ABSAE