MME opens Public Consultation to regulate the inclusion of distributed minigeneration projects in REIDI

On January 17, 2024, the Ministry of Mines and Energy (“MME”) opened Public Consultation (“CP”) No. 159/2024, aimed at receiving contributions to a draft ordinance that regulates the procedures for requesting that distributed minigeneration projects be included in the Special Incentive Regime for Infrastructure Development (“REIDI”).

Below are the main highlights on this topic.

What is REIDI?

REIDI is a program that suspends the charge of for PIS/PASEP and COFINS (taxes for social security financing) on purchases, leases and imports linked to approved infrastructure projects.

The regulations in force enable generation, cogeneration and transmission projects (not including distributed minigeneration projects) to be included in the program. The process involves a request to the Brazilian Electricity Regulatory Agency (“ANEEL”), which will analyze its suitability to the regulations in force and then recommend the project’s inclusion to the MME.

Ordinance context

Law No. 14,300/2022, which established the Legal Framework for Distributed Microgeneration and Minigeneration, established in sole paragraph of art. 28 that distributed minigeneration projects will be considered energy generation infrastructure projects in order to be included in incentive and credit programs, such as REIDI.

In September 2022, the MME published news informing that it would regulate the requirements and conditions regarding this subject. Given the time lapse with no regulation of the matter, some agents sought to be included in REIDI before ANEEL, based on the regulations in force, and even filed several lawsuits to obtain this inclusion.

Draft ordinance highlights:

Contributions to the Public Consultation can be submitted to the MME webpage by February 16, 2024.

Demarest’s Energy and Natural Resources team is available to provide any further clarifications that may be necessary.