Ministry of Mines and Energy sets guidelines and systems for the 2026 capacity reserve bidding process (LRCAP)

On October 24, 2025, the Ministry of Mines and Energy (MME) published MME Normative Ordinances No. 118 and 119, which established the guidelines and the systematic for holding Bidding Processes for the Hiring of Electric Potential. In April, the MME had suspended the holding of the LRCAP due to a legal dispute initiated by groups involved in the bidding process who disagreed with the bid pricing parameters.

The bidding processes will be conducted in the following modalities:

Normative Ordinance No. 118: Relates to new and existing natural gas-fired thermal power plants, existing coal-fired power plants, and the expansion of hydroelectric developments, entitled as the “2026 Capacity Reserve Bidding in the form of Potential – LRCAP 2026 – Natural Gas and Coal-Fired TPPs and HPPs”;

 

Normative Ordinance No. 119: Relates to existing fuel oil, diesel oil, and biodiesel-fired termal power plants, entitled as “2026 Capacity Reserve Bidding in the form of Potential – LRCAP 2026 – Oil and Biodiesel-Fired TPPs.”. Biodiesel-fired thermal power plants had been excluded in the public consultation, but were included in the final draft of the Ordinance.

The National Electric Energy Agency (Aneel) is expected to promote the 2026 LRCAPs on March 18 and 20, respectively. The deadline for registration and submission of documents for both bidding processes is 12:00 p.m. on November 14, 2025.

The Normative Ordinances also contain the rules for technical qualification, measurement and dispatch requirements, as well as the conditions for delivery and validity of Power Capacity Agreements.

The LRCAP aims to ensure the continuity of electricity supply and meet the potential requirements of the National Interconnected System (SIN) by hiring centrally dispatchable generation sources, in accordance with the sole paragraph of Article 1 of each of the Normative Ordinances.

The total amount of Capacity Reserve to be hired is established by the MME, based on studies conducted by the Energy Research Company (EPE) and the National Electric System Operator (ONS), always in line with the general supply guarantee criteria defined by the National Energy Policy Council (CNPE).

Previously, on September 12, 2025, Public Consultation No. 194/2025 was closed, which was intended to receive contributions for the drafting of Normative Ordinances No. 118 and 119, which regulate the 2026 LRCAP.

We’ve summarized the main information about the bidding processes below:

 

LRCAP 2026 – Natural Gas and Coal-Fired TPPs and HPPs:

o    Normative Ordinance No. 118 (link);

o    Will be held on March 18, 2026;

o    The deadline for registration/submission of documents is 12:00 p.m. on November 14, 2025.

 

• LRCAP 2026 – Oil and Biodiesel-Fired TPPs:

o    Normative Ordinance No. 119 (link);

o    Will be held on March 20, 2026;

o    The deadline for registration/submission of documents is 12:00 p.m. on November 14, 2025.

Our Energy and Natural Resources Team will continue to closely monitor the issues related to the bidding processes and remains available to provide clarification and additional analysis regarding the LRCAP.