Brazil's ANEEL Signs Contracts for Expansion Capacity of 5 Hydropower Plants, Adding a Total of 2.5 GW of Available Power

en.Wedoany.com Reported - On September 10, Brazil's National Electric Energy Agency (ANEEL) signed contracts with the winning bidders of the second Capacity Reserve Auction of 2026 (LRCAP 2/2026) for the expansion of 5 hydropower plants, involving the Foz do Areia, Jaguara, Luiz Gonzaga, Segredo, and São Simão hydropower plants. The 5 projects will together add approximately 2.5 GW of available power to Brazil's National Interconnected System (SIN), and the contracts formally implement the hydropower expansion results determined in the capacity auction held in March this year.

The 5 plants are operated by Copel, Engie Brasil, Axia Energia, and SPIC Brasil, respectively. Among them, Copel is responsible for the expansion of both the Foz do Areia and Segredo plants; Engie Brasil is responsible for Jaguara; Axia Energia is responsible for Luiz Gonzaga; and SPIC Brasil is responsible for São Simão. This signing covers only the hydropower projects in the LRCAP; contracts for other products such as natural gas, fuel oil, and biodiesel have not yet been signed.

LRCAP 2/2026 was held on March 18, and its core procurement target is not conventional electricity but available power that can be provided during periods of high system load. ANEEL's contracts this time explicitly require the winning hydropower projects to provide the capacity services determined by the auction to SIN, with the supply period and capacity prices executed in accordance with the winning results of each project. Official auction results show that the Jaguara project has a contract term of 15 years; after expansion, its installed scale will increase from 424 MW to 656.5 MW, with an injectable power of approximately 230.3 MW, corresponding to a winning available power of approximately 195.78 MW.

Copel's two expansion projects are the largest. The Segredo hydropower plant currently has an installed capacity of 1,260 MW, which will increase to 2,526.03 MW after expansion; the Foz do Areia plant currently has an installed capacity of 1,676 MW and is planned to be expanded to 2,536.4 MW. Copel disclosed that the two plants involve a total investment of approximately BRL 5 billion, of which Segredo accounts for approximately BRL 3.6 billion and Foz do Areia approximately BRL 1.3 billion. Related construction began in June and is planned to be completed before 2030.

The Segredo project will build a second powerhouse and install additional generating units using the existing reservoir and hydraulic structures, without expanding the original reservoir area. According to EPE technical data, after expansion the number of units will increase from 4 to 7; after the expansion of Foz do Areia, the number of units will increase from 4 to 6.

The Jaguara expansion project is being advanced by Engie Brasil, with plans to add two 116 MW generating units, adding 232 MW of installed capacity, with a total project investment of approximately BRL 1.2 billion. The expansion will use existing hydraulic structures, and the project is planned to be put into operation in 2030, after which total installed capacity will increase from 424 MW to approximately 656 MW. Dimension Network already published in July the milestone for the procurement contract of the project's two generators; this new milestone is the formal signing of the LRCAP capacity contract.

EPE previously re-verified the assured physical energy and expansion technical parameters for the hydropower expansion projects participating in the LRCAP. In addition to the above projects, São Simão is planned to be expanded from 1,710 MW to 2,020.561 MW, and the installed capacity of Luiz Gonzaga after expansion is planned to reach 1,972.8 MW. After the signing of the contracts for these 5 hydropower plants, each operator will implement the expansion equipment, construction, and capacity delivery arrangements in accordance with LRCAP requirements.