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Capacity reserve auction contracted almost 19 GW, had a predominance of thermal plants, and is expected to weigh on electricity bills. The government talks about energy security until the next decade, while consumer entities warn about tariff increases.
On March 18, 2026, Brazil held the largest energy auction in the country’s history. The 2nd Capacity Reserve Auction, known as LRCAP 2026, contracted 18.997 gigawatts of power to strengthen the National Interconnected System in the coming years.
According to the Electric Energy Commercialization Chamber, CCEE, the auction contracted 100 plants, moved R$ 515.7 billion in total revenue over the contracts, recorded an average discount of 5.52%, and generated R$ 64.5 billion in investments. The CCEE also reported that the result represents an estimated saving of R$ 33.64 billion for consumers compared to the auction’s reference prices.
The dispute was marked by the predominance of thermal power plants, especially natural gas, as well as coal projects and expansions of hydroelectric plants. The government treats the contracting as a reinforcement for the electrical system’s security until 2031. However, consumer entities warn that the model may put pressure on electricity bills.
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Largest auction in history contracted 100 plants and almost 19 GW of power
The LRCAP 2026 was held to contract firm power, that is, capacity available to operate when the electrical system needs reinforcement.
According to the CCEE, the auction lasted more than six hours, negotiated eight products in seven rounds, and ended with 100 winning plants. Together, they will provide 18.997 GW to the National Interconnected System.
This type of contracting is different from a common energy auction. Instead of just buying the energy delivered to the consumer, the model remunerates the availability of the plants for critical moments.
In practice, it works as a kind of insurance for the system. The plants are ready to start operating in situations of high demand, low hydrology, or a drop in supply from other sources.
CCEE points to R$ 515.7 billion in total revenue and R$ 64.5 billion in investments
The official numbers show the size of the dispute. According to the CCEE, the negotiation moved R$ 515.7 billion in total revenue over the contracts.
The Chamber also reported that the auction generated R$ 64.5 billion in investments and had an average discount of 5.52%. Still according to the CCEE, this discount represents an estimated saving of R$ 33.64 billion for consumers.
The annual fixed revenue of the winning enterprises was estimated at R$ 38.9 billion by MegaWhat. The specialized publication explained that this amount will be paid to the plants for power availability, while the total revenue over the contracts sums up to R$ 515.7 billion.
This point is important because it avoids a common confusion. The R$ 38.9 billion does not correspond to a monthly revenue. The data refers to the fixed annual revenue of the contracted projects.
Thermal power plants dominated the competition
The majority of the contracted power came from thermal power plants. According to CCEE, the auction contracted 60 new thermal power plants, which represent 8.86 GW of power availability.
Also contracted were 35 existing thermal plants, totaling 7.61 GW, in addition to five hydroelectric expansions, responsible for adding 2.5 GW to the system.
Among the winning companies are names like Eneva, Petrobras, Suzano, Copel, Engie, Axia, and other groups in the electric sector.
The choice for thermal plants is directly related to the need for firm power. These plants can be activated when the system needs quick reinforcement, especially during peak hours.
Government bets on energy security until 2031
The auction design was intended to ensure available power between 2026 and 2031. This contracting aims to cover moments when the electric system may become more pressured.
One of the most sensitive times is late afternoon and early evening. During this period, solar generation drops rapidly, while consumption may still remain high.
Therefore, the government argues that thermal and hydroelectric plants with additional capacity help provide stability to the system. The logic is to avoid more expensive emergency measures and reduce the risk of power shortages.
CCEE also highlighted that the contracting increases the country’s energy security, with resources available in critical situations and greater stability for the system.
Electricity bill enters the center of the dispute
The same auction presented as a supply reinforcement became the target of criticism due to the tariff impact.
The National Front of Energy Consumers stated that the contracting of 19 GW, almost entirely concentrated in natural gas thermal plants and three coal projects, could represent an annual cost of up to R$ 39 billion.
According to FNCE, this cost could lead to an average increase of at least 10% in electricity tariffs. The entity claims that the auction contracted more than necessary and favored more expensive and more polluting sources.
The criticism places the consumer at the center of the debate. On one side, the government talks about energy security. On the other, sector entities warn that this security may directly impact the electricity bill.
Consumer may pay for availability and also for fuel
FNCE also draws attention to another sensitive point. According to the entity, in addition to the fixed revenue stipulated in the auction, consumers will still need to pay the fuel costs when the plants are activated.
This means that the expense is not limited to payment for the availability of the plants. When these thermal plants actually generate energy, the cost of the fuel may also be added to the bill.
For proponents of the model, this expense is necessary to ensure stability in the electrical system. For critics, contracting in large volumes creates a heavy structural expense for residential consumers, commerce, and industry.
This debate is expected to continue in the coming years as the contracts come into effect and their impacts appear in the tariffs.
Auction exposes dispute between system security and electricity cost
The LRCAP 2026 shows an increasingly strong tension in the Brazilian electricity sector. The country needs to ensure energy at times of peak demand but also faces pressure to keep tariffs at lower levels.
The expansion of solar and wind energy has changed the functioning of the system. These sources are growing rapidly but depend on natural conditions and do not deliver power in the same way during all hours of the day.
It is in this space that thermal plants gain strength. They can operate when the system needs a supplement, but they usually bring higher costs and environmental criticisms.
The discussion, therefore, is not just technical. It involves energy security, electricity price, environmental impact, and the burden of the bill for millions of consumers.
Result expected to resonate for years in the electricity sector
The size of the auction places the LRCAP 2026 at the center of the Brazilian energy agenda. According to CCEE, 100 plants were contracted, with 18.997 GW of power, R$ 515.7 billion in total revenue, R$ 64.5 billion in investments, and an estimated savings of R$ 33.64 billion compared to reference prices.
MegaWhat reported that the annual fixed revenue of the winning plants will be R$ 38.9 billion. Meanwhile, the National Front of Energy Consumers estimates that the annual cost could reach R$ 39 billion and cause an average increase of at least 10% in tariffs.
Now, the dispute moves from the auction room to the electricity bill. The government bets that the contracting will ensure energy security until 2031. Consumer entities warn that this security could be costly.
The result is expected to continue resonating in the coming years, within the plants, in the contracts of the electricity sector, and in the pockets of those who pay the tariff.
