Publicado em 28/01/2022

New Regulation Will Allow the Implementation of Offshore Power Generation Plants in inland waters and in the Brazilian territorial sea

On June 15, 2022, the Federal Decree No. 10,946 enacted on January 22, 2021, will enter into force. The decree regulates the assignment of use of physical areas and the use of natural resources located in inland waters, in the territorial sea, in the exclusive economic zone, and on the continental shelf of Brazil, for the installation and operation of offshore power generation projects.

The Assignment of Use Agreement

The assignment of use agreement regulated by the decree is an administrative agreement for a determined term of validity, to be entered by the Federal Government, through the Ministry of Mines and Energy (MME), acting directly of via delegation to the Brazilian National Electricity Regulatory Agency (ANEEL) with companies interested in the use of the offshore area for energy generation research, technological development or exploitation and will comprise:

1. the maritime area delimited to the installation of the power plant or to the execution of the research and development activities; and
2. the Federal Union onshore areas delimited for the logistic support facilities involved in the maintenance and operation of the power plant and areas delimited for the connection of the power plant to the National Interconnected Powe Grid System (SIN).

The purpose of the assignment of use agreement shall be the exploration of an offshore power generation plant in the regime of independent power production (IPP) or self-production of energy or, the execution of research and technological development activities related to offshore energy production.

Assignment of use agreements for research activities shall not require any payment, while agreements for the implementation and development of offshore power plants will require a payment contribution from the interested party for the area use.

The assignment of use agreement must provide, at least, the following provisions:

1. the delimitation of the area object of the agreement, contemplating the vertical area of depth coinciding with the seabed, with a polygonal surface defined by the geographic coordinates of its vertices (Prism);
2. transmission facilities;
3. financial guarantees for the commissioning and decommissioning of the facilities;
4. the obligation to carry out studies of offshore energy potential as a requirement to obtain the authorization grant (Outorga);
5. payment obligations in respect to the amount owed to the Federal Union, the method of calculation and payment, as well as sanctions for default or delay;
6. the right to establish or support the structures intended for generation and transmission on the seabed, in compliance with the rules of the maritime authority and the environmental license to be issued by the competent environmental agency;
7. term, conditions and requirements for extension of the agreement as well as termination conditions;

The assignment of use agreement does not constitute any immediate right to explore power generation activities, which remains subject to ANEEL’s regulations related to the granting, trading, and self-production of energy.

As a condition for the grant (Outorga), ANEEL must have previously approved the offshore energy potential studies, attesting the fulfillment of the criteria established by the MME.

The Procedure for the Execution of the Assignment of Use Agreement

There are two possible modalities for the assignment of use:

1. the planned assignment, in which the MME offers Prisms previously delimited (after a public consultation procedure with the potential interested parties), through a bidding process to be regulated by the MME, the judgment criterion being the highest economic return for the assignment of the prism; or
2. the independent assignment, requested by the interested parties, aiming at the development of the project within the limits and georeferenced coordinates of the intended Prism. MME will check if there is an overlap between the requested area with Prisms already granted or in the process of obtaining, and may grant or reject the request.

The obtaining of a Declaration of Prior Interference (DIP, Declaração de Interferência Prévia), to be issued with the purpose of identifying the possible existence of interference of the prism in other facilities or activities is a requirement for the execution of the assignment of use agreement.

Necessarily, at least the following agencies and entities must be consulted for the issuance of their respective DIPs: (i) the Navy Command; (ii) the Air Force Command; (iii) IBAMA; (iv) Chico Mendes Institute for Biodiversity Conservation; (v) ANP; (vi) the Ministry of Infrastructure; (vii) the Ministry of Agriculture; (viii) the Ministry of Tourism; and (ix) the National Telecommunications Agency (ANATEL).

Interested parties with processes of assignment of use in progress must ratify to the MME their interest in relation to the Prisms already requested and adapt the current processes to comply with the new provisions of the decree.

The MME is also entitled to carry out energy purchase auctions specifically designed for the contracting of offshore energy, when designated by the Energy Research Company’s (EPE) planning or in the Ten Year Energy Expansion Plan.