Brazil's Federal Court of Accounts Freezes R$5.02 Billion, Electricity Tariff Reduction for Distribution Companies Halted

en.Wedoany.com Reported - Minister Antonio Anastasia of Brazil's Federal Court of Accounts (TCU) decided this Monday (17th) to freeze funds arising from the renegotiation of the Public Asset Usage Fee (UBP, concession fees paid by hydroelectric plants). The ruling requires the Electric Power Trading Chamber (CCEE) to reserve R$5.02 billion in the Energy Development Account (CDE), preventing their transfer to beneficiary distribution companies to offset electricity tariffs.

The decision also prohibits the National Electric Energy Agency (ANEEL) from deciding, authorizing, or ordering the CCEE to transfer the aforementioned frozen funds during the validity period of the provisional measure. Anastasia stated in his ruling that these measures will remain in effect until a final decision is made on the merits of the appeal. According to the document, the freeze can be lifted if it is proven that the funds have been deposited into the Single Treasury Account and included in the annual budget law or supplementary credits. The ruling deemed it appropriate to issue the provisional measure immediately to prevent irregularities. The minister also authorized hearings, requiring ANEEL, CCEE, the Ministry of Mines and Energy, and the Federal Budget Secretariat of the Ministry of Planning and Budget to respond within 15 days.

This ruling stems from a complaint filed by the TCU's specialized unit for budget, tax, and fiscal management audits (AudFiscal). The unit questioned that these funds were not collected through the Single Treasury Account and were not registered in the Federal General Budget (OGU), arguing that the operation could constitute budget and fiscal irregularities. According to the technical department, the failure to remit funds to the Treasury and register them in the OGU exempts these resources from fiscal rules, such as the primary spending cap and primary fiscal result targets. The complaint also mentioned that the government had previously adopted similar procedures, such as the Pé-de-Meia program, which was also subject to TCU review.

ANEEL conducted the UBP renegotiation based on Law No. 15,235/2025, which stipulates that the collected funds will be used to offset electricity tariffs for consumers in the Sudam and Sudene regions. Some distribution companies had already used these funds in advance in their respective tariff proceedings, and the regulatory agency approved transfers to each concessionaire last week.

AudFiscal argued in its complaint that the provisional measure was necessary because ANEEL's board had ordered the CCEE to transfer R$3.9 billion to distribution companies, with a deadline of up to 10 days starting August 14th. According to the document, reversing potential damages would be unfeasible if the transfers were completed. The audit unit maintained that, although the operation was authorized by Law No. 15,235—which also stipulates that collection will be carried out through the CDE—the law does not authorize separating these funds from the Single Treasury Account. AudFiscal also noted that the law does not alter the public nature of UBP funds, which are paid to the government by hydroelectric plants, and the Federal Constitution stipulates that payments made under the name of public asset usage fees constitute federal property revenue.