Our consultant Luiz Felipe Monteiro Seixas spoke to the BNamericas website about the capacity auction (LRCAP), which takes place tomorrow, 18 March.
Designed to ensure energy security by contracting new and existing power stations, which can be switched on and off according to the needs of the electricity system, some rules in the tender notice have raised concerns among experts due to potential operational and legal risks. The ceiling prices set for the auction have also been criticised.
For Luiz, the tender notice follows the logic of system reliability, but transfers a greater operational risk to the developer, as remuneration will depend on compliance with all the dispatches defined in the daily schedule established by the National System Operator (ONS).
From a legal perspective, however, he does not see any obvious weaknesses, but points out areas requiring attention. “The combination of performance penalties with rules on the cancellation or termination of rounds may raise questions as to whether this affects the economic predictability of the contracts,” he analyses.