The market continues to expect the Joint Committee responsible for Provisional Measure 1.304 to establish a work plan, with less than a month remaining before the measure expires. The deadline is November 7th.
The scenario that involved the processing of MP 1.300 is repeating itself, with the attention of parliamentarians more focused on urgent issues of the federal government, such as MP 1.303, on investment taxation (IOF), which expired on Wednesday (8).
A meeting of the Joint Committee, chaired by Representative Fernando Coelho Filho (União-PE), former Minister of Mines and Energy, was also expected to define a work plan. Senator Eduardo Braga (MDB-AM) was also expected to be nominated as rapporteur for the process.
According to information from Braga, however, a meeting with Coelho Filho and the presidents of the houses should take place throughout this Thursday (9) to discuss the progress of the agenda.
The expectation is that next week will be dedicated to public hearings and that the report will be presented to the committee the following week.
Structuring topics
Originally, Provisional Measure 1.304, dated last July, was sent by the government to the National Congress with only seven articles. Notable among these are those dealing with limiting the spending cap for the Energy Development Account (CDE), new conditions for access to and sale of natural gas, and the replacement of mandatory contracts for inflexible thermoelectric plants with PCHs (Small Hydroelectric Power Plants).
The “dehydration” of MP 1.300, however, preserved the extension of the Social Tariff – which was sanctioned yesterday by President Lula – and, due to the lack of time, the debates regarding the points considered “structuring” and much more complex, both from a technical and political point of view, ended up being transferred to MP 1.304.
Thus, MP 1.304 gained momentum and, depending on the progress, could become the long-awaited reform of the electricity sector framework.
Associations united by storage
From the inheritance of PM 1.300, among other items, the general opening of the free energy market, a possible mitigating solution to the issue of curtailment, as well as a possible limitation of subsidies for the expansion of renewable generation remained.
But, since the referral of the PM 1.304 The government received 435 amendments, slightly fewer than the approximately 600 submitted to Provisional Measure 1.300. Of this package, at least 41 are aimed at addressing the issue of energy storage, a technology considered one of the solutions to mitigate curtailment.
One possibility that could be studied under Provisional Measure 1.304 is to break down the curtailment problem into two parts. One would seek emergency solutions to alleviate past losses, while the second would focus on long-term prevention mechanisms.
MPs 1.300 and 1.304 pose risks to solar DG, warn associations
Diversity of proposals
Objectively, regarding the distribution, rapporteur Coelho Filho recently stated that there will be no changes to existing rights. He also stated that he does not agree with the MME's (Ministry of Mines and Energy) initial proposal to end benefits involving network use for existing contracts, citing the risk of litigation and legal uncertainty.
He also said there is consensus in Congress on the need to modernize the electricity sector. But he warned that it's no longer acceptable to overcharge consumers.
The other amendments to Provisional Measure 1.304 address topics such as: adequate revenues for different applications, such as capacity, ancillary services, virtual lines, and distributed generation; creation of a storage agent and a distributed resource aggregator to increase the efficiency of micro and mini-generation; charges and tariffs proportional to costs and benefits; differentiated granting and registration models according to the size of the project; recognition of storage as an infrastructure project for access to Reidi benefits and fundraising through incentivized debentures.
Under the pressure of the calendar and the diversity of parliamentary suggestions to be evaluated, the Joint Committee will still have to worry about monitoring the ANEELThe Agency pointed out amendments that pose potential risks, especially regarding curtailment and the possibility of an eventual increase in subsidies, with consequent losses to consumers.
In parallel with the processing of MP 1.304, the ANEEL Equally critical issues are also addressed. MMGD's control over distribution networks is one of them, something that is being studied in conjunction with the ONS (National System Operator). Another highly sensitive issue is the creation of new tariff modalities as a way to provide price signals to encourage more rational consumption.
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