Brazilian experience in electricity auctions: Comparing outcomes from new and old energy auctions as well as the application of the hybrid Anglo-Dutch design

Erik Eduardo Rego and Virginia Parente

Energy Policy, 2013, vol. 55, issue C, 511-520

Abstract: Since 2004, the Government of Brazil (GoB) has acted as an intermediary between distribution and generator companies in the energy procurement sector. The GoB procures energy from generator companies through auctions of long-term energy contracts. After an auction, the winning generator companies sign contracts directly with distribution companies. In particular, the GoB runs two different auctions: one for energy from existing power plants (i.e., old energy) and another for energy from power plants that have not yet been built (i.e., new energy). This paper describes these auctions and compares the outcomes from the old and new energy auctions from 2004 to 2010 using final auction prices. The Brazilian case is particularly interesting, not only because energy is predominantly supplied by hydropower plants but also because new energy auctions reach prices below those for old energy. Therefore, it is likely that it is not necessary to run the two different energy auctions. As a secondary objective, this article analyze whether the Anglo-Dutch hybrid auction model is a better design for electricity procurement in Brazil.

Keywords: Anglo-Dutch energy auction; Brazilian electricity market (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (26)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0301421512010956
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:55:y:2013:i:c:p:511-520

DOI: 10.1016/j.enpol.2012.12.042

Access Statistics for this article

Energy Policy is currently edited by N. France

More articles in Energy Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().