Framework for distributed minigeneration projects in REIDI

With the collaboration of lawyers Leonardo Balbino and Victória Viola

As disclosed by Canal Solar, on January 17, 2024, the MME (Ministry of Mines and Energy) initiated Public Consultation No. 159/2024 through the Ordinance No. 765/GM/MME, to address the legal requirement for distributing minigeneration projects to be included in the REIDI (Special Development Incentive Regime).

The accelerated growth of DG (distributed generation) projects in Brazil is nothing new. According to data provided by ANEEL (National Electric Energy Agency), micro and mini distributed generation added 7,4 GW in installed power, reaching around 26 GW and, furthermore, reached at least 625 thousand new systems connected to the distribution network.

In this sense, with the advent of the Distributed Generation Framework, through Law No. 14.300, of January 06, 2022, in order to support the advancement of DG and expand the possibilities of capturing financial resources and benefits, distributed minigeneration was included in the list of electricity generation infrastructure projects eligible for REIDI, under the terms of the sole paragraph of article 28 of the aforementioned legislation.

Although the sole paragraph of article 28 of the Law was vetoed by the President of the Republic at the time, the National Congress rejected it and allowed its inclusion.

Even so, to date, there is a gap between the publication of the law and the actual obtaining of the benefit. This is because the legislation establishes that they would only be able to enjoy the REIDI benefit following an authorizing ordinance from the MME, which has not occurred to date.

After around two years between the inclusion of the permission in the GD legal framework, CP 159/2024 was opened. Through Ordinance No. 765/GM/MME, distributed minigeneration projects will be able to enjoy the expected benefit of REIDI.

The respective benefit is widely used in the energy sector, with approximately 3.460 (three thousand, four hundred and sixty) entrepreneurs having the benefit, as indicated in the Report on Enterprises included in REIDI within the scope of the MME.

As with other infrastructure projects, to qualify for the benefit it is necessary to fulfill requirements set out in Decree No. 6.144, of July 3, 2007, which regulates REIDI.

Therefore, according to the decree, the infrastructure projects eligible for classification and qualification in REIDI are:

• Generation, cogeneration, transmission and distribution of electrical energy; and
• Production and processing of natural gas in any physical state.

In line with the aforementioned REIDI Decree, the proposed regulations for requesting classification of REIDI distributed minigeneration projects determine the following procedure for request, namely:

• Firstly, the enterprise holding the infrastructure project must request inclusion in REIDI from the Ministry responsible for the infrastructure sector to which the project for the implementation of works is part;
• Distributed minigeneration projects owned by a private legal entity, in accordance with Decree No. 6.144/2007, can be included in REIDI upon request to the electricity distributor, to which the respective consumer unit is connected;
• Requests to qualify for REIDI must be made using an Information Form, containing (a) the data of the legal entity holder (or future holder of the consumer unit with minigeneration); (b) information on the electrical energy infrastructure project; and (c) estimates of investments and tax suspension;
• After receiving the requests, the distributor will evaluate the requests and also check whether they correspond to the data provided for in the Distribution System Use Contracts (CUSD) and licenses/authorizations by the consumer;
• By electronic means, until the tenth business day of the month following the date of submission of the request so that the distributor can forward it to ANEEL any information mentioned in item (ii) above and the result of its assessment;
• A ANEEL will analyze the request for REIDI classification, with a view to attesting whether the request is in line with the legislation and regulations, including the compatibility of investment estimates and the tax suspension value.
•  After analysis, it will forward to the MME its recommendation regarding the classification of REIDI;
• The MME will also evaluate it and the project will only be considered a priority after publication of an MME ordinance, as described in § 3 of art. 6th of Decree No. 6.144, of 2007.

Despite the opening of CP 159/2024, sector agents must remain alert and actively contribute to the debates.

After waiting for regulation, there are points of attention that must be assessed with caution due to the expectation that orders will be placed with distributors and that ANEEL participate in this process, which will certainly imply delays in the entire process, which may hinder the effective obtaining of the benefit within the schedule for the implementation of the DG projects.

Agents must contribute within 30 days from the publication of the CP with the aim of improving the current procedure proposed by the benefit request regulations for distributed minigeneration projects.

To access the public consultation, click here.