Brazil’s reserve battery capacity auction guidelines near finalization, 20 GW of projects already in line

On Tuesday, February 10th, ANEEL approved the bidding documents for the capacity reserve auctions that will contract energy from hydroelectric and thermoelectric plants using natural gas and coal (2nd LRCAP), as well as thermoelectric plants powered by diesel, fuel oil, and biodiesel (3rd LRCAP). The auctions are scheduled for March 18 and 20, 2026, respectively.

Alongside approving the bidding rules, ANEEL sent a letter to the Ministry of Mines and Energy recommending consideration of regionalized auctions, with criteria for the locational allocation of contracted power, as requested by the Infrastructure Services Committee of the Federal Senate.

The auction guidelines were published in a Ministry of Mines and Energy decree in October 2025, and more than 125 GW of projects have registered to participate.

The auction for reserve battery storage capacity, which went through public consultation last November, has not yet been officially published. The draft ordinance initially foresaw an April auction – one month after the LRCAP for thermal and hydroelectric plants – but the market now expects it to be postponed to the second half of the year. The Ministry of Mines and Energy has stated that the ordinance is in its final consolidation phase. To promote the auction, Minister Alexandre Silveira conducted visits to Chinese companies in October and January. If published in February, and following the same five-month lead time as the LRCAP auctions, the battery auction could take place in July.

Market activity is already significant, with energy companies, battery manufacturers, and EPC contractors developing more than 20 GW of projects in anticipation of the auction.

Reserve capacity auctions are critical to balance the National Interconnected System (SIN), especially during peak demand periods when solar generation is insufficient. According to the National System Operator (ONS), SIN could face a power deficit in 2026 ranging from 2,320 MW in September under favorable inflow conditions to 5,154 MW under worst-case hydro scenarios. The Ministry of Mines and Energy is studying options to bring forward projects contracted in previous auctions to help meet demand.

The volume to be contracted in this year’s auctions remains unknown, but ABSAE estimates that contracting 2 GW of power with 8 GWh of storage could unlock R$10 billion in investments.

From pv magazine Brazil