The Brazilian Electricity Agency (ANEEL) has made available on its website a proposed notice of the third and fourth auctions for the purchase of electricity from existing generator enterprises. A proposed invitiation to bid and contract is also available on the website. The final versions of the documents, as well as the bidding timetables, dates and locations for the auctions, will be approved by ANEEL as soon as the Ministry of Mines and Energy defines the format of the auctions.
According to the proposed notice electricity lots of 1.0 megawatts will be traded. The third auction will offer three-year contracts for supply from January 2006 to December 2008. In the fourth auction the contracts will be for eight years, with supply from January 2009 to December 2016. The initial prices of each lot are expected to be decided by the ministry.
The rules proposed for the notice and the contract for the purchase and sale of electricity in a regulated environment are fundamentally the same as those of the first and second power auctions, which were held in December 2004 and April 2005.Therefore, it will not be necessary to submit the rules to a public hearing.
The use of auctions to guarantee the supply of the power distributor market is provided for in Law 10,848/04, which established the new trading model for the electricity sector. The auctions will be coordinated by ANEEL and conducted by the Electric Power Trading Chamber.
Invitations to bid will be sent to the distribution concessionaires, which will be able to participate as buyers. Power generation concessionaires and permit or authorization holders, including importers and traders, will be able to operate as sellers in the auctions.
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