On July 21, 2026, the Ministry of Mines and Energy (“MME”) published Normative Ordinance MME No. 140/2026 (“Ordinance”), which sets out the guidelines for the operationalisation of the compensation for costs arising from generation curtailment of wind and solar power plants, occurring between September 1, 2023 and November 25, 2025, pursuant to article 1-B of Law No. 10,848, of 15 March 2004, as included by Law No. 15,269, of 24 November 2025.
The Ordinance aims to regulate the assessment, classification and payment of the compensation owed to holders of authorised wind and solar power plants connected to the Basic Grid and to the Other Transmission Facilities (“DITs”), and seeks to mitigate sector disputes relating to the effects of constrained-off on power generation agents, through the execution of a Commitment Term with the Federal Government.
1. Subject matter and compensation period
The Ordinance governs the compensation for generation curtailment events occurring between September 1, 2023 and November 25, 2025, provided they are classified as electrical reliability events or external unavailability events. Curtailments arising from electricity oversupply — that is, the impossibility of allocating generation on the load curve — remain excluded from compensation, pursuant to the draft Commitment Term set out in the Annex to the Ordinance.
2. Requirements to obtain financial compensation
In order to be entitled to compensation, the holder must cumulatively meet the following conditions:
- having filed, within 20 days of the publication of the Ordinance, a prior expression of interest in adhering to the Commitment Term before the MME – a stage for which the deadline has already lapsed;
- submitting to the Energy Trading Chamber (“CCEE”) the documentation evidencing legal representation, containing specific and express powers to settle and waive rights, and evidencing payment of the applicable fee, within ten days of the publication of the notice convening execution of the Commitment Term, to be issued by the MME; and
- executing the Commitment Term with the Granting Authority within the period to be established in the notice of convening. Execution of the Commitment Term is irrevocable and irreversible and implies express agreement with the criteria for the assessment, classification and valuation of the compensation owed for generation curtailment events.
3. Data update and assessment of generation curtailments
The Ordinance authorises photovoltaic generation agents to submit to the National Grid Operator (“ONS”) solarimetric measurement records for the preparation of productivity functions relating to the period from September 1, 2023 to March 31, 2024, in accordance with a schedule with staggered deadlines for disclosure, submission and challenge, for the purposes of assessing and classifying generation curtailment events.
Correspondingly, interested agents may submit to the ONS, in respect of the period from September 1, 2023 to February 10, 2025, updated anemometric or solarimetric measurement records and generation and availability data. However, information updates will only be accepted in the following circumstances:
- a failure has been identified in the real-time receipt of information via operational supervision; or
- more reliable information is available and recorded in the power plant’s measurement systems.
In addition, the updated information must faithfully correspond to the value actually available at the time of the event and must be duly recorded in the power plant’s measurement system. In this context, the data resulting from these procedures will only be incorporated into the ONS and CCEE databases used in the assessment and calculation of the compensation if the relevant holder executes the Commitment Term; otherwise, such data will be disregarded.
4. Classification of generation curtailments
Generation curtailment events will be assessed by the ONS on an hourly basis and classified exclusively as (i) external unavailability; (ii) electrical reliability; or (iii) electricity oversupply. Following the review of the information received, the CCEE will disclose the generation curtailment amounts on an hourly and per-power-plant basis, classified in accordance with the categories referred to above.
Where generation curtailments with different classifications occur within the same hourly window, the classification of external unavailability shall prevail, if applicable; and, alternatively, the classification of electrical reliability.
5. Calculation, valuation and payment of the compensation
The compensation will be operationalised by the CCEE by means of the financial resettlement of past events, with monetary restatement based on the variation of the National Broad Consumer Price Index (“IPCA”) from the date of the event until the effective payment. The resettlements relating to the period from September 1, 2023 to November 25, 2025 must be completed by the CCEE within 180 days, counted from the first business day after the final deadline for execution of the Commitment Term.
As for the valuation, the portion of eligible curtailments not committed under a Reserve Energy Agreement (“CER”) or an Energy Purchase Agreement in the Regulated Market for Availability (“CCEAR-D”) will be valued at the PLD (settlement price for differences) of the submarket in which the power plant is located.
In this context, in order to enable the financial resettlements, the settlement of amounts relating to the reimbursements owed by wind and solar photovoltaic generation agents — relating to CER and CCEAR-D — will remain suspended, during the respective time windows, for agents that have filed a prior expression of interest and executed the Commitment Term.
Accordingly, the financial effects of the monthly resettlement events for reserve energy and the reassessment of CCEAR sale revenue must be operationalised prior to the effects of the resettlement of the Short-Term Market (“MCP”), for the period from September 1, 2023 to November 25, 2025. In addition, the credits owed to generators as a result of the compensation will not participate in the apportionment of default amounts in the settlement of the MCP.
In the case of power plants contracted under Proinfa and connected to the Basic Grid of the SIN, the compensation for generation curtailments arising from the execution of a Commitment Term will be paid to the grantee by means of ENBPar, which will act as an intervening party in such Commitment Terms. The amounts of curtailed energy will be valued by the CCEE based on the price of the energy contracted under Proinfa in force at the time of the curtailment, subject to the applicable rules, with ENBPar being responsible for informing the CCEE of the contractual prices in force during the relevant period.
Finally, the amounts of generation curtailments, whether or not eligible for compensation under the Ordinance, must be considered as verified electricity generation for the purposes of the annual review of the generation output (garantia física) amounts of wind and solar photovoltaic power plants, subject to the deadlines and methodology to be defined by the MME.
6. Waiver of administrative, arbitration and judicial disputes
The execution of the Commitment Term entails an irrevocable and irreversible waiver of the right to challenge, through administrative, arbitration or judicial proceedings, compensation for generation curtailment events occurring up to November 25, 2025, in addition to withdrawal of any ongoing judicial proceedings on the matter. In such cases, the holder must provide evidence to the Granting Authority of the formalisation of the waiver and withdrawal in the relevant judicial proceeding, as a condition for the operationalisation of the compensation.
The Ordinance further provides that the CCEE must approve and disclose the trading rules and procedures adapted to the provisions of the Ordinance within 60 days of its publication, provide market training within 90 days, and submit the operationalisation to an independent audit for the validation of data and results.
7. Current status of the procedure
Against this background, the first stage of the procedure, relating to the submission of the prior expression of interest, has already been concluded. According to information attributed to the MME and disclosed by specialised sector media outlets, 1,539 wind and solar photovoltaic power plants, totalling approximately 53 GW of installed capacity, expressed interest in proceeding with the mechanism. The expression of interest, however, constitutes merely a requirement for participation in the subsequent stages and does not equate to the execution of the Commitment Term.