Decree to regulate the exploitation of offshore wind energy is published 27 jan 2022

Decree to regulate the exploitation of offshore wind energy is published

Decree No. 10,946/2022 (“Decree”), which regulates the exploration of offshore wind energy in Brazil, was approved by the President of the Republic and published on January 25, 2022.

The regulatory innovation is an important milestone for new opportunities in the Brazilian power generation industry. The Decree will enter into force on June 15, 2022, and will enable offshore wind research and generation projects within the physical spaces of the Federal Government’s internal waters, the territorial sea, the exclusive economic zone, and of the continental shelf of Brazil, referred to in the Decree as “prisms”.

The Decree establishes that the exploration right shall be granted through the assignment of the use of maritime spaces, authorized by the Ministry of Mines and Energy (“MME”) and formalized by means of an onerous assignment contract for the use of public property. In regard to the performance of research and technological development activities related to offshore wind generation, the assignment of use shall be free of charge.

The assigned areas shall be previously delivered to the MME by the Secretariat for Coordination and Governance of the Federal Government’s Assets of the Special Secretariat for Privatization, Divestment and Markets of the Ministry of Economy, which shall be the competent entity to coordinate the procedures for the assignment of use to interested parties.

The use of the area may be assigned through a planned assignment by the government, with the offer of prisms to private interested parties following a bidding procedure, or through an independent assignment, in which private companies may request to the MME the exploration of the prisms provided that previous studies are carried out.

In regard to the bidding procedure, the interested parties must prove sufficient technical, operational, economic-financial, and legal capacity to guarantee the implementation of the project, the operation, and the decommissioning of activities, as provided for in the bid invitation. The winner of the bidding shall be the company that presents to the government the proposal with the highest economic return for the area assignment.

The Decree establishes that the assignment of use is dissociated from the authorization for the power energy generation enterprise, which shall also depend on authorization from the National Electric Energy Agency (“ANEEL”). The MME may also delegate to ANEEL powers to sign the use assignment contracts and carry out the necessary acts for their formalization.

Further, it is a requirement for the assignment of use of area the issuance of a Prior Interference Declaration (“DIP”), which aims to identify the existence of interferences of the prism in other facilities or activities. The DIP must be issued by the Navy Command, Air Force Command, IBAMA, ICMBio, National Petroleum Agency (“ANP”), Ministry of Infrastructure, Ministry of Agriculture, Livestock and Supply, Ministry of Tourism, and National Telecommunications Agency (“ANP”). ANATEL”).

The Decree also establishes that the regulatory agencies involved shall issue joint regulations for the implementation of hybrid projects, with the ANP and ANEEL also responsible for evaluating the assignment of prisms coinciding with oil or natural gas production areas.

The MME shall issue complementary rules to the provisions of the Decree within 180 days from the date it comes into effect.

The regulatory framework follows the guidelines of the National Energy Planning for 2050, prepared by the Energy Research Company, which highlights the offshore wind energy source as one of the most promising energy generations in expansion in Brazil for the following years.

Our team is available for further information on offshore wind regulation in Brazil.

Key Contacts:

Alexandre Calmon
Partner
E: acalmon@cmalaw.com

Fabiano Gallo 
Partner
E: fabiano.gallo@cmalaw.com

Marcelo Frazão
Partner
E: mfrazao@cmalaw.com

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