Engie Brasil warns of a possible drop in the competitiveness of the transmission auction due to interest rates and acquisition

A Engie Brasil has everything ready to participate in the transmission auction that will take place next Friday, June 30th. It is expected that perhaps the competition will take place at a level below the previous disputes. 

After participating in a panel discussion at a CEBRI event on Wednesday, June 28 in Rio de Janeiro, the president of Engie Brasil Energy, Eduardo Sattamini said: “A high level of competition is expected, perhaps lower than previous events due to some specificities with interest rates, investments acquired by some players and size of lots. It won't be easy, but we'll do our best."

However, about the other competition signaled by the Ministry of Mines and Energy for the year 2024, is stipulated at R$20 billion, the executive commented that this decision was right, stating that he has been talking to governments for some years that in order to have a sustainable industry in transmission, it is necessary to have investments distributed over time. 

In this way, another event is already scheduled, scheduled to take place in October 2023. President Eduardo said he believes in the auction being carried out and also in the capacity at the end of the year to provide greater security to the system, this in the midst of a scenario of super offers of intermittent renewables. By the way, working with the creation of value for hydroelectric plants that today suffer a lot from the market structure and also the lack of valuation of their attributes.

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Engie Brazil: subsidies 

Subsidies in the sector permeated a good part of the last panel of the first day of the event. Eduardo da Engie Brasil says he is against the existence of more incentives of this type, unless they are very well structured and with a deadline to end. However, unlike most of the Lobbies that are seen in the National Congress.

Therefore, for the leader when introducing new technologies regulatory agility is needed to be able to correct the inefficiencies brought to the system, even more so if the subsidy has been extended for certain sources. It is also important to remember that another point that cannot be left out, according to Eduardo, is the need to increase the value of hydroelectric plants in order to offer prices.

In addition, the executive pointed out that it is also necessary to look at the commercial capacity of the reduced plants and compensate for the extension of concessions. In such a way, reformulating ways for the sector not to have GSF below the current 85%, unless it is for hydrological reasons.