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Power generation in Brazil: concessions, authorizations, regulated auctions and ANEEL fees

Last verified: 2026-10-27 · Status: Changing

Hydro potentials belong to the Union, and the size and use of a plant decide whether it needs a concession after bidding, an ANEEL authorization or only a notice. Distributors must buy all their energy in regulated auctions under long term contracts of up to 35 years for new plants, which is the main bankable revenue route for new generation, while the free market keeps opening. The 2025 power reform also shifted capacity reserve costs onto new generators that do not meet system requirements and let coal plants exit early.

Key facts

Capacity above which hydro and public service thermal plants need a concession	50000 kWLei nº 9.074 art. 5, as of 2026-10-27 · in force
Capacity above which thermal plants and hydro need an ANEEL authorization	5000 kWLei nº 9.074 art. 7, as of 2026-10-27 · in force
Maximum supply term of regulated contracts for new plants	35 yearsLei nº 10.848 art. 2 § 2 III, as of 2026-10-27 · in force
Maximum supply term of regulated contracts for existing plants	15 yearsLei nº 10.848 art. 2 § 2 II, as of 2026-10-27 · in force
ANEEL inspection fee (TFSEE)	0.4 % of annual economic benefitLei nº 9.427 art. 12 § 1, as of 2026-10-27 · in force
Minimum notice for early coal plant decommissioning	6 monthsLei nº 9.074 art. 7 § 2, as of 2026-10-27 · in force

The rule

1. Mineral deposits and hydraulic energy potentials belong to the Union and are developed only by authorization or concession to Brazilians or companies incorporated under Brazilian law with head office and management in Brazil. Small capacity renewable potentials need no authorization or concession.Constitution of Brazil, Art. 176 caput and §§ 1 and 4, 1988-10-05 official text · verified 2026-10-27

2. A concession after public bidding is needed for hydro potentials above 50,000 kW and for thermal plants above 50,000 kW serving the public service, and for hydro above 50,000 kW for independent production or the exclusive use of an autoproducer.Lei nº 9.074, as worded by Lei nº 13.360 of 17 November 2016, Art. 5 I to III, 1995-07-07 official text · verified 2026-10-27

3. An ANEEL authorization is needed for thermal plants above 5,000 kW for autoproduction or independent production, and for hydro potentials above 5,000 kW and up to 50,000 kW for the same uses. Plants of 5,000 kW or less, hydro or thermal, need no concession, permission or authorization and are only notified to the grantor, but must respect the river's approved fall division and other holders' registrations.Lei nº 9.074, as worded by Lei nº 13.360 of 17 November 2016, Arts. 7 I and II, and 8 caput and §§ 1 and 3, 1995-07-07 official text · verified 2026-10-27

4. Distributors in the national grid must cover 100 percent of their market through regulated contracting by public bidding, signing energy trading contracts (CCEARs) with every winning generator. Energy from existing plants starts delivery in the auction year or up to the fifth following year, for 1 to 15 years; energy from new plants starts between the third and the seventh year after the auction, for up to 35 years.Lei nº 10.848, as amended by Lei nº 13.360 of 2016 and Lei nº 15.269 of 24 November 2025, Art. 2 caput and § 2 II and III, 2004-03-15 official text · verified 2026-10-27 · changed: Lei nº 15.269 of 24 November 2025 reworded the delivery and term rules for new plants: start from the third to the seventh year after the auction, supply of at most 35 years.

5. Generators applying for access to the transmission or distribution grid after the 2025 reform must pay a share of capacity reserve contracting, in proportion to the energy they generate, until they meet the system requirements referred to in Lei nº 9.648 art. 9 § 2. Capacity reserve costs are otherwise shared among all final users of the national grid, including free consumers and autoproducers for their grid supplied energy.Lei nº 9.074 art. 8-A and Lei nº 10.848 art. 3-A, both as included or worded by Lei nº 15.269, Lei nº 9.074 art. 8-A; Lei nº 10.848 art. 3-A, 2025-11-24 official text · verified 2026-10-27 · changed: Lei nº 15.269 of 24 November 2025 added art. 8-A to Lei nº 9.074, charging new grid applicants for capacity reserve.

6. Coal fired thermal plants, using national or imported coal, may bring forward decommissioning at no charge by applying to ANEEL at least 6 months before the intended date; if they hold regulated contracts, ANEEL must arrange their termination.Lei nº 9.074 art. 7 §§ 2 and 3, included by Lei nº 15.269, Art. 7 §§ 2 and 3, 2025-11-24 official text · verified 2026-10-27

7. Every generation, transmission and distribution concessionaire, permit holder and authorized agent, including independent producers and autoproducers, pays the annual Electricity Services Inspection Fee (TFSEE), equal to 0.4 percent of the annual economic benefit, computed for generation as installed capacity times 0.4 percent of the unit annual benefit.
Cost to do it: 0.4 percent of the annual economic benefit set by ANEEL for the plant.Lei nº 9.427 (ANEEL Law), as worded by Lei nº 12.783 of 11 January 2013, Art. 12 caput and § 1, 1996-12-26 official text · verified 2026-10-27

8. A consumer who moves to the free market must contract its entire load with one or more suppliers, under penalty, although the grantor may relax this by regulation.Lei nº 9.074 art. 15 § 7, as worded by Lei nº 15.269, Art. 15 § 7, 2025-11-24 official text · verified 2026-10-27

Plant	Use	Grant
Hydro above 50 MW	Public service, independent producer or autoproducer	Concession after bidding
Thermal above 50 MW	Public service	Concession after bidding
Thermal above 5 MW	Independent producer or autoproducer	ANEEL authorization
Hydro above 5 MW up to 50 MW	Independent producer or autoproducer	ANEEL authorization
Hydro or thermal up to 5 MW	Any	Notice to the grantor only
Solar or wind micro and mini generation	Consumer generation	See Distributed generation page

Which grant a power plant needs (Lei nº 9.074 arts. 5, 7 and 8).

Worked example

A 30 MW small hydro plant selling to the regulated market: it needs an ANEEL authorization (Lei nº 9.074 art. 7 II), can sell in a new energy auction with delivery starting between the third and seventh year after the auction and a contract of up to 35 years (Lei nº 10.848 art. 2 § 2 III), and pays TFSEE at 0.4 percent of the annual benefit set by ANEEL. If it requested grid access after 24 November 2025 and does not meet the system requirements, it also bears a share of capacity reserve costs (Lei nº 9.074 art. 8-A).

Step by step

1. Size the plant and use to identify the grant: concession, authorization or notice.
2. Register the project with ANEEL and the river inventory where hydro is involved; check no other holder has an active registration on the stretch.
3. Obtain environmental licences and grid access; check whether art. 8-A capacity reserve charges apply.
4. Qualify with the energy planning agency and bid in regulated auctions, or sign free market PPAs.
5. Sign CCEARs with all distributors buying in the auction and post guarantees.
6. Budget TFSEE and sector charges from commercial operation.

Common traps

Even plants of 5 MW or less, which need only a notice, must follow the river's approved fall division and cannot sit on a stretch where another party holds an active ANEEL registration (art. 8 §§ 1 and 3).
Delivery under a new energy auction can start as late as the seventh year; financing must bridge construction to first revenue.
New grid applicants after 24 November 2025 may carry capacity reserve costs until they meet system requirements, which changes merchant solar and wind economics.
Free market buyers must contract 100 percent of their load; under contracting is penalized.

Sources

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