In more detail
Do the new rules affect existing self-production projects?
The new rules of MP 1,300 do not affect existing self-production projects. Consumers who registered their energy purchase and sale contracts with the Brazilian Electric Energy Commercialization Chamber (CCEE) prior to the publication of MP 1,300 will retain their rights. They may continue to enjoy regulatory benefits until the end of their authorization to produce energy or, as long as the conditions justifying their "classification" as self-producers persist.
If MP 1,300 is approved with the current wording by the National Congress, consumers qualified as self-producers by equivalence will have their rights recognized by law, offering greater legal certainty to existing projects.
What are the new rules for self-production by equivalence?
MP 1,300 changes the concept of energy self-producer, which had been in place since 2007 (and adjusted in 2015), and which attracted thousands of companies to invest in energy generation projects.
The new rule requires a minimum aggregate contracted demand equal to or greater than 30,000 kW, with individual units of at least 3,000 kW each. Previously, only a minimum of 3,000 kW was required. This change limits access for lower-demand consumers.
As before, to be considered a "self-producer by equivalence" and obtain regulatory benefits, the consumer must hold an equity stake in the energy-producing company. However, the new rule restricts structures that allowed low-investment participation. If the energy-producing company that owns the power plant issues non-voting shares granting greater economic rights than to the voting shares, the consumer must hold at least 30% of the company's equity stake. This measure will force consumers to make substantial investments in generation projects.
The benefit applies to the smaller of: (i) the portion of energy intended for the consumer's own consumption, and (ii) the amount of the total output of the power plant, multiplied by the "shareholder's participation in the Project". Agência Nacional de Energia Elétrica (ANEEL) will regulate the identification and update of information on the self-production by equivalence consumers.
Additionally, the equivalence will only apply to new projects, i.e., those entering commercial operation after 21 May 2025 (the date of publication of the MP 1,300). The only exception is the transition period described below.
What are the transition rules for consumers not yet deemed as self-producers?
As seen in other major reforms of the energy sector, MP 1,300 provides a 60-day transition period from its publication for consumers to submit to CCEE: (i) contracts for the purchase and sale of shares or quotas in the energy-producing company; or (ii) call option agreements for the purchase and sale of shares or quotas in the energy-producing company, in either case, the contracts must be duly signed and formalized. The transfer of the shares/quotas must occur within 24 months of the contract's signing date. Within the same period, the consumer shall present the corporate documents evidencing the transfer to CCEE.
The transition rules also require that the generation projects must have entered commercial operation after 15 June 2007 (the date in which Law No. 11,488 was published, which introduced the equivalence concept).
What other changes does MP 1,300 introduce?
The MP 1,300 regulates the tariff and accounting separation between distribution and regulated commercialization activities, the regulation of the Last Resort Supplier (SUI), the expansion of access to the free market for low-voltage consumers, the redistribution of tariff charges resulting from over-contracting and involuntary deficit. These measures are intended to ensure tariff affordability, legal certainty and the economic sustainability of the sector.
Regarding the opening of the energy market, MP 1,300 continues the process started by Ministry of Mines and Energy Ordinance No. 50/2022, which removed the minimum load requirements for high-voltage consumers. The new measure stipulates that industrial and commercial consumers served at low voltage (i.e., below 2.3 kV) will be able to freely choose their suppliers as of 1 August 2026; other consumers will have this right as of 1 December 2027, expanding competition and allowing direct negotiation of energy price with generators.
Finally, regarding the tariff affordability, MP 1,300 provides for the redistribution of tariffs and charges with the aim of zeroing out the electricity bills of more than 60 million low-income Brazilians. According to the proposal, consumers with a monthly consumption of up to 80 kWh and a per capita income of up to half the minimum wage will have a total exemption from their electricity bill.
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