By Brazil Stock Guide – Brazil’s Federal Court of Accounts (TCU) on Wednesday (15) accepted a formal complaint alleging irregularities in a power capacity auction held in March 2026 by the Ministry of Mines and Energy. The decision allows auditors to examine how price caps were defined in the auction process.
The case was filed by the Public Prosecutor’s Office at the TCU, raising concerns about the criteria used in the so-called Capacity Reserve Auction (LRCAP), particularly regarding pricing parameters.
The proceeding is being led by Minister Jorge Oliveira, who endorsed the technical recommendation to proceed with an investigation. “I fully agree with the technical unit’s proposal to allow auditors to inspect the involved entities and gather the necessary information to monitor the auction,” he said during the plenary session.
The complaint highlights a sharp increase in the auction’s price cap, which reportedly rose by as much as 80%. Deputy Prosecutor General Lucas Furtado had requested a precautionary measure to suspend the auction, citing this increase and other potential irregularities.
The request for suspension was denied by the reporting minister, allowing the auction to stand. However, the authorization of an audit signals that the court intends to conduct a deeper review of the procedures adopted and their potential impact on Brazil’s electricity sector.
Auditors are now expected to carry out inspections across the entities involved to collect detailed information and monitor further developments.
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