BRAZIL Trends and Developments Contributed by: Márcio Pina, André Serrão, Thiago Furtado and Gustavo Oliveira, Advocacia Bettiol
preferentially on those who received AccessAu- thorization With Restrictions and/or DAPR/P. 47. Furthermore, it should be noted that Article 15 of Normative Resolution No 1,030 provides, in §8, that the ‘ONS shall disregard, from the gen- eration’s reference, the generation reductions associated with the restrictions indicated in the access report of the plants or sets of wind power plants’. In other words, if the Operator does not act in accordance with the aforementioned rule of precedence, there is even a risk that consum- ers, in the event of generation restriction due to external unavailability, will be unduly subjected to the payment of higher ESS amounts (to the extent that a generation restriction is carried out associated with an access report without restric- tion, instead of the one that received its report with restriction). 48. Still on this aspect, it is worth pointing out that §9 of art. 15 determines that, in the ‘case of sets of wind power plants, the ONS must con- sider the apportionment of the reference for the frustration of energy generation proportionally to each wind power plant’s installed capacity’, which seems to me to be contradictory to the principle pursued in §8. 49. Therefore, in my view, in a cursory judgment, the situation described supports the granting of a precautionary measure favorable to the Agent.” For such reasons, it seems undeniable that gen- eration cuts must follow the criteria that distin- guish agents with Access Authorization free from restrictions from agents whose access authori- sations impose restrictions or conditions due to their interference in systemic reliability.
Lack of logical correlation between the generation cuts for energy reasons and the nature of reserve energy contracts, capacity contracts and self-production The risk of insufficient load and, therefore, gen- eration cuts for “energy reasons” cannot be attributed to reserve energy contracts, avail- ability contracts and self-production. These are situations that are completely unrelated to the hypothesis in which there is surplus generation. The sale of electricity can be separated into at least three different products: (i) electricity gen- eration (or electrical energy); (ii) electricity capac- ity; and (iii) ancillary services. Under the terms of §1 of Article 1 of Decree No 6,353/2008, reserve energy is not linked to the contractual coverage of the resale, or energy consumption. It is an additional capacity to that ordinarily intended to attend consumption. Reserve energy func- tions as an additional security mechanism for the transmission system itself. Reserve energy occurs in cases of consump- tion that exceed the electricity capacity origi- nally contracted. On the other hand, generation is constrained for energy reasons in the oppo- site situation, when there is excess generation. Therefore, it is contrary to the nature and scope of reserve energy contracts to attribute to the reserve energy generator a risk associated with insufficient load. In situations of insufficient load, the reserve generator is not even activated. For these reasons, it can be concluded that there is no logical correlation between the attribution of generation curtailment for energy reasons (when there is a risk of insufficient load) to reserve ener- gy contracts. Similar reasons indicate that generation cuts for energy reasons cannot be applied to contracts based on availability. In this case, the capacity
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