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Brazil May Hold Four 2013 Power Auctions, Up From One Last Year

Brazil may hold four auctions for contracts to sell power from new projects this year, up from one last year, as distributors seek to meet future energy demand, according to a wind trade group.

The government may also revise its current auction format so developers planning projects that produce power from different sources and in different regions won’t compete against each other, Elbia Melo, president of Associacao Brasileira de Energia Eolica, said at a conference in Sao Paulo today.

Lower than expected economic growth in 2012 and uncertainty among power distributors over future energy supply drove down the number of contracts sold in auctions last year, she said.

“The scenario is completely different in 2013,” Melo said. Distributors in Brazil signed contracts for 574 megawatts of new capacity last year, compared with 5,174 megawatts in three auctions in 2011, according to the country’s energy research agency Empresa de Pesquisa Energetica. More than half of 2011 capacity sold was from wind farms.

Brazil hasn’t determined how many auctions to hold this year, Altino Ventura Filho, secretary of energy planning and development for the Ministry of Mines and Energy, said today in an interview. In the country’s energy auctions, developers bid down the price at which they are willing to sell power from planned projects and the lowest prices win contracts.

To contact the reporter on this story: Will Wade in New York at wwade4@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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