1) ANEEL Launches Public Consultations on Aligning Electricity Tariffs and Contracts with Brazil’s Tax Reform
On October 20, the Brazilian Electricity Regulatory Agency (ANEEL) approved the launch of two public consultations addressing the effects of Brazil’s Tax Reform on the electricity sector. Public Consultation No. 38/2026 concerns regulatory asset bases and mechanisms for restoring the economic and financial balance of distribution and transmission concessions. The proposals include introducing a negative financial component in tariffs to prevent the double recovery of PIS/Cofins tax credits relating to assets acquired before the reform, revising the sharing of distribution companies’ other revenues, and establishing a transmission-specific Adjustment Component.
Public Consultation No. 39/2026, in turn, addresses adjustments to regulated electricity generation and trading contracts and sector-specific charges. ANEEL has proposed removing PIS/Pasep and Cofins from the prices of contracts executed before January 16, 2025, by applying rates of 3.65% under the cumulative regime, 9.25% under the non-cumulative regime, or a weighted average, as applicable. The proposal would dispense with individual contractual amendments. Both consultations are open for submissions from October 21 to 30 and may affect tariff-setting, revenue allocation and the economic and financial balance of contracts as the IBS and CBS are introduced.
2) ANEEL Approves New Rules for Mandatory Generation Curtailment
On October 6, ANEEL approved new regulations governing the order and allocation of mandatory generation curtailments, concluding a regulatory debate that began in 2019. The framework addresses restrictions arising from electricity oversupply and seeks to reconcile operational security, lower system-wide costs and the distribution of impacts among generators.
Energy-related curtailments will be shared across different generation sources, with the gradual inclusion, over four years, of the hydropower component associated with water spillage that could otherwise have been used for generation. For self-generators, energy-related curtailment should generally apply only to generation exceeding on-site consumption. The regulation provides for a simulation phase beginning 180 days after its publication and lasting 12 months, with full implementation after 18 months, as well as an independent audit and greater transparency of operational data. The decision directly affects the financial exposure of wind, solar and hydropower generators, as well as self-generators.
3) ABREN and 20 Other Associations Call for ReData Regulations to Be Issued in 2026
On October 16, the Forum of Electricity Sector Associations (FASE), representing 21 organizations, including ABREN, sent a letter to the Presidency of the Republic requesting priority treatment for the regulation of the Special Tax Regime for Data Center Services (ReData). Established by Law No. 15,504/2026, the regime provides for the suspension of federal taxes on eligible purchases and imports of equipment, subject to statutory conditions. The absence of regulations governing enrollment requirements and eligible goods hinders implementation, particularly given the time-limited tax incentives available in 2026.
The associations are calling for the prompt publication of the rules governing admission to ReData and the list of equipment eligible for the benefit, including items without domestically produced equivalents for purposes of suspension of Import Duty. The letter also emphasizes the importance of reliable, low-emission electricity supply for data centers, which operate continuously. Expansion of this market could encourage investment in generation, energy storage and transmission, as well as new long-term power purchase agreements.
Our partner, Yuri Schmitke, highlighted that waste-to-energy generation can supply critical loads with firm, low-emission power, alongside biomass, biogas and biomethane. ABREN also presented the WASTAI (Waste to Data) concept, which envisages integrating a waste-to-energy facility, a data center and heat-recovery systems to support server cooling within a single complex. This is an integrated-technology proposal whose implementation will depend on technical and economic feasibility, permitting and contractual structuring.
4) MME Proposes Raising the Natural Gas Market Decarbonization Target to 1% in 2027
The Ministry of Mines and Energy (MME) launched a public consultation under MME Ordinance No. 942/2026 on the greenhouse gas emissions reduction target for the natural gas market in 2027. The proposal sets a 1% target, compared with the 0.5% target established for 2026, and outlines a trajectory of 3% in 2028, 4% in 2029 and 5% in 2030. This remains a proposal subject to public consultation, rather than a definitive target already approved for 2027.
According to the parameters presented by MME, the 2027 rate would correspond to annual consumption of approximately 363.2 million m³ of biomethane, or 995,200 m³ per day, and the issuance of approximately 3.63 million Biomethane Certificates of Guarantee of Origin (CGOBs). The target level and the carbon-intensity assumptions used in its calculation will influence regulated demand for certificates, the expansion of domestic production and the economics of biogas and biomethane projects.
5) Court Denies Injunction Against São Paulo Waste-to-Energy Plants; ABREN Seeks to Intervene as Amicus Curiae
In early October, the 6th Public Treasury Court of the City of São Paulo denied the preliminary injunction requested by the São Paulo State Public Defender’s Office in Public Civil Action No. 1116511-94.2026.8.26.0053. The action seeks to suspend implementation of four Waste-to-Energy Facilities (UREs) planned for Eco-parks under the municipal cleaning concessions operated by Ecourbis and Loga. The Public Defender’s Office challenges the addition of the facilities to contracts originally entered into in 2004 without a new public tender, as well as their potential effects on recycling, waste pickers and the environment.
In denying the injunction, Judge Liliane Keyko Hioki noted that Brazil’s National Solid Waste Policy expressly permits energy recovery and considered the consequences of halting the projects for the city’s waste-disposal capacity. The ruling is not a final judgment on the legality of the contractual amendments or the environmental feasibility of the facilities: the merits remain pending, subject to evidentiary proceedings and any applicable appeals.
ABREN filed a motion seeking leave to participate in the proceedings as amicus curiae, with the aim of providing technical input on the use of energy recovery in waste treatment and its consistency with sector-specific legislation. Filing the motion should not be confused with the court granting admission, which had not been confirmed by the sources reviewed. Each project also remains subject to its own environmental assessments and authorizations.
6) Yuri Schmitke Examines the Legal Basis for Waste-to-Energy Facilities and the Modernization of São Paulo’s Urban Cleaning Concessions
In an article published by JOTA on October 20, our partner, Yuri Schmitke, examined the legal framework governing energy recovery from municipal solid waste and the possibility of integrating this technology into the modernization of São Paulo’s municipal cleaning concessions. The article notes that Article 3(VII) and Article 9(1) of Law No. 12,305/2010 expressly allow energy recovery, provided that its technical and environmental feasibility is demonstrated and an emissions-monitoring program approved by the competent authority is implemented, without displacing the priority given to waste prevention, reduction, reuse and recycling.
The article also examines the duty to keep public services up to date under Article 6(2) of Law No. 8,987/1995, together with the need for adequate justification, economic and financial feasibility studies, transparency in contractual amendments and consistency with the scope of the original tenders. The projects must comply with their own environmental licensing procedures, public participation requirements, verifiable recycling targets and the inclusion of waste pickers, distinguishing statutory authorization for the technology from the specific approval of each facility.
7) ABREN Proposes Including Waste-to-Energy in Federal Methane Reduction Plan
ABREN submitted comments to the Ministry of the Environment and Climate Change’s public consultation on the National Clean Air and Climate Action Plan, proposing that waste-to-energy be included among measures to mitigate short-lived climate pollutants, particularly methane. The association argues that this technology, already recognized under the National Solid Waste Policy and the National Solid Waste Plan, should form part of the strategy for managing residual waste that cannot be recovered through recycling or biological treatment.
According to ABREN’s preliminary estimates, meeting the target of approximately 994 MW of installed waste-to-energy capacity by 2040 could prevent around 290,000 metric tons of methane emissions per year and generate approximately 8 TWh of electricity annually. Our partner, Yuri Schmitke, emphasized the need for environmentally sound disposal of the residual waste that remains after sorting and materials recovery. The proposal was submitted during a public consultation that closed on October 9 and is still subject to the Ministry’s final decision on the plan.
8) ANP Accredits B3 as Registry Operator for Biomethane Certificates of Guarantee of Origin
On October 9, the National Agency of Petroleum, Natural Gas and Biofuels (ANP) approved the accreditation of B3 S.A. as a registry operator for Biomethane Certificates of Guarantee of Origin (CGOBs). The decision brought the number of accredited registry operators to three — B3, ACX Brasil and Instituto Totum — alongside seven accredited Origin Certification Agents and three book-entry service providers.
The accreditation expands the infrastructure available for the future issuance, registration, trading, cancellation and retirement of certificates representing the environmental attributes of biomethane. This development comes as the 2027 decarbonization target is under discussion and helps establish mechanisms for verifying compliance by natural gas producers and importers. Accreditation of market participants does not, in itself, mean that CGOB trading has already begun.
9) ANEEL Seeks Market Input on Allocation of Charges for Battery Storage Procurement
ANEEL launched Public Consultation No. 37/2026 to discuss the funding base and allocation methodology for the Capacity Reserve Charge associated with the procurement of Battery Energy Storage Systems (Ercap-SAE). The proposal distinguishes this charge from the General Capacity Reserve Charge (Ercap-Geral), with a view to preventing overlap between funding arrangements.
Under the draft, holders of authorizations or registrations for power generation facilities participating in the CCEE would contribute to the charge, excluding distributed micro- and mini-generation and standalone storage. Determining which market participants will bear the charge will be critical to procurement costs, expected project revenues and the economic structure of Brazil’s first energy storage auctions.
10) ANP Updates Technical Data Rules to Cover Hydrogen and Geological CO₂ Storage
On October 2, ANP’s Board approved a revision of ANP Resolution No. 889/2022, expanding the scope of the rules governing the acquisition, processing and access to technical data. The revised scope covers geoscientific surveys related to prospecting for underground natural gas storage sites, exploration for and production of naturally occurring hydrogen, and the identification of geological formations suitable for carbon dioxide capture and storage (CCS).
The revision also establishes authorization procedures for drilling data-acquisition wells in uncontracted federal areas and governs consortia of data-acquisition companies, including the designation of a lead company. The regulation is a further step in implementing the legal frameworks for hydrogen and CCS, although authorizations to build and operate CO₂ capture and injection projects remain subject to separate regulations.
11) Transmission Auction No. 4/2026 Envisages BRL 8.9 Billion in Investment
ANEEL confirmed that Transmission Auction No. 4/2026 will take place on October 30 at B3. The auction envisages investments of approximately BRL 8.9 billion in projects across Bahia, Goiás, Mato Grosso do Sul, Paraíba, Paraná, Rondônia and São Paulo. The lots comprise 1,866 km of new transmission lines and line sectionalizations, along with 12,694 MVA of transformer capacity and compensation equipment.
The deadlines for completing the projects range from 42 to 60 months after execution of the concession agreements. Expansion of transmission infrastructure could facilitate the delivery of renewable electricity and reduce operational constraints in the National Interconnected System (SIN). As of October 27, the auction results were not yet available, since the public auction session was scheduled for October 30.
12) MME Establishes Guidelines for Reducing Inflexible Thermal Generation During Oversupply
On October 26, the Ministry of Mines and Energy announced the signing of a regulatory ordinance setting guidelines to optimize the use of inflexible thermal generation in the National Interconnected System. The measure seeks to allow generators operating under Power Purchase Agreements in the Regulated Market (CCEARs) to offer the National Electric System Operator (ONS) a full or partial reduction in contractually inflexible generation when electricity from other sources is in excess supply.
The ability to adjust fuel procurement and reduce dispatch from higher-cost units could generate savings for regulated consumers and enable greater use of renewable generation. Implementation will depend on the conditions set out in the ordinance and its official publication, while remaining subject to system security and reliability requirements.
13) MME and CCEE Advance Financial Compensation for Wind and Solar Generation Curtailments
On October 5, the Electricity Trading Chamber (CCEE) published a list of wind and solar projects eligible to pursue compensation for generation curtailments under MME Regulatory Ordinance No. 140/2026, pursuant to Law No. 15,269/2025. The National Electric System Operator (ONS) assessed the applications.
The mechanism covers eligible events occurring between September 1, 2023, and November 25, 2025. Inclusion on the list allows the process to proceed, but does not constitute final recognition of amounts payable, which remains subject to execution of a Commitment Agreement and completion of the other applicable steps. The initiative addresses the historical financial consequences of curtailments, while ANEEL’s new regulations are intended to govern the allocation of future curtailments.
14) First Closed-Loop Pumped-Storage Hydropower Project Registered with ANEEL
Through Order No. 3,960/2026, ANEEL registered the first application for authorization of a closed-loop pumped-storage hydropower system. The Salto Timbé do Sul project, in Santa Catarina, has a planned capacity of 5.2 MW and falls under the procedures established by ANEEL Normative Resolution No. 1,161/2026.
Registration is an optional step preceding authorization and may assist the developer in conducting studies and obtaining permits, without conferring preferential rights or guaranteeing final authorization. The technology uses reservoirs to alternate between pumping and electricity generation, expanding the range of energy storage and operational flexibility solutions available to the electricity sector beyond batteries.
