By Brazil Stock Guide – Brazil’s electricity regulator Aneel criticized Enel SpA (ENEL IM) after its São Paulo distribution unit sought a court injunction to suspend an ongoing administrative process that could lead to the loss of its concession.
The case, filed on Tuesday (17), prompted a strong reaction from Aneel Director-General Sandoval Feitosa, who said he was “surprised” by the company’s legal move. Speaking on Wednesday (18) in São Paulo, he said the utility is attempting to block a scheduled regulatory review and invalidate a vote already submitted within the agency.
“We were informed this morning that the company filed a writ of mandamus, not yet judged, to prevent this deliberation from taking place and also to nullify the vote already issued in the process,” Feitosa said.
Aneel is expected to challenge any favorable court ruling for the company. “We will obviously appeal if the injunction is granted,” he added.
The concession review stems from mounting political pressure following repeated power outages affecting residents and businesses in the São Paulo metropolitan area. Brazil’s Mines and Energy Minister Alexandre Silveira, São Paulo Governor Tarcísio de Freitas and the city’s mayor Ricardo Nunes have jointly called for the termination of the contract.
The regulator emphasized that no final decision has been made. Aneel’s board postponed the case review until Monday (24), when it is scheduled to return to the agenda.
“There is no judgment, no decision. What exists is the scheduling of a meeting,” Feitosa said, adding that the company’s legal action attempts to interfere with the regulator’s administrative process.
While acknowledging that companies have the right to seek judicial remedies, he warned that preventing the regulator from acting could undermine Brazil’s regulatory framework. “The judiciary is a legitimate path, but blocking the regulator from doing its job would represent a very harmful stage for our regulatory process,” he said.
Feitosa also urged the company to prioritize service improvements over legal strategies. “I strongly recommend that the company direct all possible efforts toward improving service quality for citizens and reduce its reliance on expanding legal support to avoid Aneel’s work,” he said.
He noted that Aneel’s role includes enforcing service standards, applying penalties and, when warranted, recommending concession termination—a process whose final decision rests with Brazil’s federal government.
Aneel has previously recommended concession terminations in 30 cases, mostly in electricity transmission, with final decisions taken by the Mines and Energy Ministry.
Enel said in a statement it remains confident in its legal arguments and in Brazil’s judicial system. The company also stressed that any decision should be “analyzed in an impartial and technical manner, in accordance with legality and the facts established in the process.”
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