MP with the TCU admits error and reviews position on capacity auction
The deputy attorney general of the MPTCU (Public Prosecutor's Office at the Federal Court of Auditors), Lucas Rocha Furtado, reviewed his position on the LRCap (Capacity Reserve Auction) and stated that he was wrong to give predominant weight to the cost of the auction for consumers to the detriment of the safety and stability of the electrical system.
The statement is contained in a letter sent to Minister Jorge Oliveira, rapporteur of the processes that analyze the event at the TCU. In the document, Furtado informs that he decided to review the previously expressed position after analyzing a "Technical, Regulatory and Legal Manifestation in Defense of the Health of the 2026 Capacity Reserve Auction", received by the Public Prosecutor's Office at the court.
"I expressly acknowledge that I was wrong to attribute, in my initial statement (representation), predominant weight to the price to be paid by consumers to the detriment of the stability and security of the electrical system, which are essential for both consumers and investors who operate over a long-term horizon", wrote the deputy attorney general.
The statement represents a relevant change of position because it was Lucas Furtado himself who presented a representation to the TCU asking for the precautionary suspension of the auction and the reevaluation of the parameters used in the event.
In the letter, however, he states that the LRCap analysis must consider three aspects in a balanced way: tariff reasonableness and economic rationality, security and operational stability of the electrical system and environmental criteria aligned with the energy transition.
According to Furtado, the search for competitive prices cannot be dissociated from the need for robustness and reliability of the electrical matrix nor from the environmental impacts associated with the different technological alternatives available.
The deputy attorney also states that any assessment of the auction must necessarily consider the safety of the system in critical operating conditions, in addition to the environmental effects resulting from planning and regulatory decisions.
"Taking into account the content of the memorandum forwarded, I recognize the need for a broader and more balanced analysis of these factors, so that the final decision on LRCap 2026 provides legal certainty and predictability to agents in the electricity sector, while at the same time protecting consumers and promoting environmental sustainability", he wrote.
Approval suspended
The TCU continues to evaluate questions related to the formation of ceiling prices, competitiveness and the design of the event. However, the Federal Court of Ceará ordered this Monday (8) the immediate suspension of the approval of the results of the 2026 Capacity Reserve Auctions (LRCap) and the execution of the respective Capacity Reserve Power Contracts.
The preliminary decision was handed down by federal judge Luis Praxedes Vieira da Silva, from the 1st Federal Court of Ceará, in a lawsuit filed by Fiec (Federation of Industries of the State of Ceará) and Sindienergia. The measure represents a new twist in the auction process held in March, which contracted around 19.5 GW of power.
Source: CNN