File #2342: "2018_Book_EnergyLawAndRegulationInBrazil.pdf"
Text
1|Introduction|5
2|References|9
1|Contents|10
1|Editors and Contributors|12
1|Legal Regulation of Petroleum Upstream in Brazil|19
2|1 Introduction|19
2|2 Historical Background|20
3|2.1 Brazilian Oil and Gas Legislation Before 1997|21
3|2.2 The 1988 Brazilian Constitution and the Constitutional Amendment No. 9 from 1995|22
3|2.3 The Years After 1995|23
2|3 Twenty Years of the Petroleum Law (Law No. 9.478/97)|25
3|3.1 Background|25
3|3.2 Biddings: 1st to 13th Bid Round|26
3|3.3 New Bidding Rounds|29
3|3.4 Institutional Aspects of the Oil and Gas Industry|30
4|3.4.1 Brazilian National Agency of Petroleum´s Historical and Present Importance|30
4|3.4.2 The Distribution of Regulatory Powers After the Pre-salt|31
2|4 Brazilian Exploration and Production Contracts, from Concession to Production Sharing|33
3|4.1 Concession Agreement|33
3|4.2 Production Sharing Agreement|33
3|4.3 Onerous Assignment|34
2|5 Hot Topics|34
3|5.1 Unitization|35
3|5.2 Local Content|36
3|5.3 Arbitration|37
3|5.4 Government Participation|38
3|5.5 Environmental Matters: General Aspects and Shale Gas|40
2|6 Present Challenges and Perspectives|41
2|References|43
1|Brazilian Regulation of Petroleum Downstream|45
2|1 Downstream in Petroleum Industry|45
2|2 Regulation on Refining and on the Processing of Natural Gas|48
2|3 Regulation on Transportation of Crude Oil and Derivatives|51
3|3.1 Land Transportation|52
3|3.2 Maritime Transportation|54
2|4 Regulation on Consumption|56
3|4.1 Distributors and Resellers|56
3|4.2 TRRs|57
3|4.3 TRRNI|58
3|4.4 Reseller|58
2|5 Challenges and Perspectives|60
2|6 Concluding Remarks|60
2|References|61
1|Regulatory Framework of Upstream and Onshore Unconventional Gas in Brazil|62
2|1 Onshore Unconventional Potential in Brazil: Economic and Strategic Analysis|62
2|2 Legal and Regulatory Framework|65
3|2.1 Current Concession Agreement in Brazil|66
3|2.2 ANP Resolution 21 of 2014|70
2|3 Current Regulatory Issues|71
2|4 Challenges and Perspectives to the Onshore Unconventional Exploration in Brazil|72
3|4.1 Inadequate Exploration Deadlines for Unconventional Resources|72
3|4.2 Lack of American Success Factors|74
3|4.3 Supply Chain of Goods and Services|76
3|4.4 Environmental Licensing|78
2|5 Concluding Remarks|80
2|References|82
1|Midstream Regulation in Brazil: Main Issues in Pipeline Natural Gas System|83
2|1 Economic and Strategic Analysis|83
2|2 Legal and Regulatory Framework|85
3|2.1 Open Access Rules|86
3|2.2 Capacity Assessment Directive|87
3|2.3 Review of ANP Directives # 27/2005 and 28/2005: Directive 11 from 2016|87
3|2.4 Tariff Criteria Directive|88
3|2.5 ANP Directive # 15/2014|88
3|2.6 Brazilian Natural Gas Law|90
2|3 Current Regulatory Issues|91
3|3.1 Tariff Policies|91
3|3.2 Open Access Request and Others Issues by Directive 11/2016|93
2|4 Challenges and Perspectives|94
3|4.1 Pricing Challenges and Perspectives|94
4|4.1.1 Relative Weight of the Transport Price on the Consumer Final Price|95
4|4.1.2 The Price of Natural Gas in the Brazilian Market|98
3|4.2 Open Access and Third-Parties: Challenges and Perspectives|101
2|5 Concluding Remarks|104
2|References|105
1|Regulatory Challenges of Natural Gas Downstream in Brazil|107
2|1 History|107
3|1.1 Duties and Responsibilities|108
3|1.2 Gas Law|111
3|1.3 European Community Law and Regulation in the United Kingdom|112
3|1.4 US Law: Regulation of FERC|113
2|2 Brazilian Regulatory Challenges|114
3|2.1 Flow, Transfer and Distribution Pipelines|115
3|2.2 Regulation of Operational Exchange: Swap|117
3|2.3 Free Consumer|118
3|2.4 State Interconnection|119
2|3 Contractual Challenges|122
3|3.1 Agreement for Purchase and Sale of Natural Gas|122
3|3.2 Transportation Contracts|123
2|4 Systemic Risks|125
3|4.1 Regulatory Risk|125
3|4.2 Tax Risk|126
3|4.3 Market Risk|126
2|5 Conclusion|127
2|References|127
1|The Electricity Sector and the Structure of the Short-Term Market in Brazil|129
2|1 Introduction|129
2|2 The Structure of the Brazilian Electricity Sector|131
2|3 The Market Operator and the Sector´s Multilateralism|133
2|4 Information Principles for the Agents´ Performance in the Electricity Sector|136
2|5 The Jurisdictional Control Over Regulatory Acts|142
2|6 The Issue of the ``Regulation´´ by the Judiciary Branch|143
2|7 The Impacts of Court Decisions on the Short-Term Market|146
2|8 The Increasing Judicialization and the Necessary Discussion of the Market Rules|148
2|9 Conclusion|150
2|References|151
1|Legal Regulation of the Distribution of Electricity in Brazil|152
2|1 Economic and Strategic Analysis|152
3|1.1 Distribution Market in Brazil|152
3|1.2 The Economics of the Distribution Activity|154
2|2 Legal and Regulatory Framework|158
3|2.1 Constitutional Provisions|159
3|2.2 Concession Contracts|161
3|2.3 Tariff Formation and Revision|163
3|2.4 Consumer Protection|166
2|3 Current Regulatory Issues|168
3|3.1 Political Interference|168
3|3.2 Extension of Concession Contracts|170
2|4 Challenges and Perspectives|171
2|5 Concluding Remarks|172
2|References|172
1|Regulatory Framework of Wind Power in Brazil|174
2|1 Economic and Strategic Analysis|174
3|1.1 PROEOLICA and PROINFA|176
3|1.2 Wind Power in the New Energy Model|180
3|1.3 Evolution of Wind Energy Capacity in Brazil|183
2|2 Legal and Regulatory Framework|183
3|2.1 Free Market Environment|184
3|2.2 Regulated Market Environment|188
4|2.2.1 Regulated Energy Auctions|188
4|2.2.2 Reserve Energy Auctions|189
4|2.2.3 Evolution of Competitiveness Based on Energy Price|190
2|3 Challenges and Perspectives|190
3|3.1 Environmental Licensing|191
3|3.2 Connection to the Grid System: Who Will Pay for Wind Farms Not Connected to the Grid System?|192
3|3.3 Regulatory Bottlenecks and the Mathematics of Force Majeure|193
2|4 Concluding Remarks|195
2|References|196
1|Solar Energy and the Dawn of `Solar Cities´ in Brazil|197
2|1 Introduction|197
2|2 Economic and Strategic Analysis of the Solar Energy in Brazil|199
3|2.1 The Emergence of Photovoltaic Energy Systems (EFV)|200
3|2.2 Obstacles to the Development of Photovoltaic Energy Systems (EFV)|202
2|3 Legal and Regulatory Framework|203
3|3.1 Constitutional Treatment of the Potential Exploiting of Solar Energy|204
3|3.2 Public Policies and Incentives Related to the Generation and Use of EFV and Thermosolar|205
3|3.3 Energy Compensation System for Distributed Micro and Minigeneration (Net Metering)|210
2|4 Current Regulatory Issues|212
3|4.1 ``Solar Capitals´´: Search Results|212
3|4.2 A ``Ray of Light´´ in the Brazilian Emissions of Greenhouse Gases (GHG): The Case of the Municipality of São Paulo|220
2|5 Challenges and Perspectives|222
2|6 Concluding Remarks: ``Is There Light at the End of the Tunnel´´?|223
2|References|224
1|Challenges of Social and Environmental Certification of Biofuels in Brazil|227
2|1 Introduction|227
2|2 Certification: Competitive International Commercial Advantage|228
2|3 Environmental Requisites and Market Accessibility: Prevention to ``Green Protectionism´´|229
2|4 World Environmental Labelling and Environmental Labelling in Brazil|232
2|5 Social Seals and Worker Standards|234
2|6 Conclusion|239
2|References|240
1|Regulatory Framework of Nuclear Energy in Brazil|242
2|1 Economic and Strategic Analysis|242
2|2 Organization of the Nuclear Sector|244
2|3 Governance of the Nuclear Sector|247
2|4 Legal and Regulatory Framework|252
2|5 Current Regulatory Issues|254
2|6 Conclusions|259
1|Main Issues of Biomass Energy Regulation in Brazil|262
2|1 Introduction|262
2|2 Legal and Regulatory Framework|264
3|2.1 Regulatory Authorities|264
3|2.2 Upstream Regulation|266
3|2.3 Downstream Regulation|267
2|3 Current Regulatory Issues|268
3|3.1 Ethanol|268
3|3.2 Cogeneration|269
3|3.3 Charcoal and Firewood|270
2|4 Challenges and Prospects|271
2|5 Concluding Remarks|271
2|References|272
1|International Trade in Energy: A Glance at Selected Issues|273
2|1 Introduction|273
2|2 Regulation of International Trade in Energy|274
2|3 Subsidies Within the Energy Sector|276
2|4 Energy Integration in South America|280
2|5 Final Considerations|283
2|References|284
2|References|9
1|Contents|10
1|Editors and Contributors|12
1|Legal Regulation of Petroleum Upstream in Brazil|19
2|1 Introduction|19
2|2 Historical Background|20
3|2.1 Brazilian Oil and Gas Legislation Before 1997|21
3|2.2 The 1988 Brazilian Constitution and the Constitutional Amendment No. 9 from 1995|22
3|2.3 The Years After 1995|23
2|3 Twenty Years of the Petroleum Law (Law No. 9.478/97)|25
3|3.1 Background|25
3|3.2 Biddings: 1st to 13th Bid Round|26
3|3.3 New Bidding Rounds|29
3|3.4 Institutional Aspects of the Oil and Gas Industry|30
4|3.4.1 Brazilian National Agency of Petroleum´s Historical and Present Importance|30
4|3.4.2 The Distribution of Regulatory Powers After the Pre-salt|31
2|4 Brazilian Exploration and Production Contracts, from Concession to Production Sharing|33
3|4.1 Concession Agreement|33
3|4.2 Production Sharing Agreement|33
3|4.3 Onerous Assignment|34
2|5 Hot Topics|34
3|5.1 Unitization|35
3|5.2 Local Content|36
3|5.3 Arbitration|37
3|5.4 Government Participation|38
3|5.5 Environmental Matters: General Aspects and Shale Gas|40
2|6 Present Challenges and Perspectives|41
2|References|43
1|Brazilian Regulation of Petroleum Downstream|45
2|1 Downstream in Petroleum Industry|45
2|2 Regulation on Refining and on the Processing of Natural Gas|48
2|3 Regulation on Transportation of Crude Oil and Derivatives|51
3|3.1 Land Transportation|52
3|3.2 Maritime Transportation|54
2|4 Regulation on Consumption|56
3|4.1 Distributors and Resellers|56
3|4.2 TRRs|57
3|4.3 TRRNI|58
3|4.4 Reseller|58
2|5 Challenges and Perspectives|60
2|6 Concluding Remarks|60
2|References|61
1|Regulatory Framework of Upstream and Onshore Unconventional Gas in Brazil|62
2|1 Onshore Unconventional Potential in Brazil: Economic and Strategic Analysis|62
2|2 Legal and Regulatory Framework|65
3|2.1 Current Concession Agreement in Brazil|66
3|2.2 ANP Resolution 21 of 2014|70
2|3 Current Regulatory Issues|71
2|4 Challenges and Perspectives to the Onshore Unconventional Exploration in Brazil|72
3|4.1 Inadequate Exploration Deadlines for Unconventional Resources|72
3|4.2 Lack of American Success Factors|74
3|4.3 Supply Chain of Goods and Services|76
3|4.4 Environmental Licensing|78
2|5 Concluding Remarks|80
2|References|82
1|Midstream Regulation in Brazil: Main Issues in Pipeline Natural Gas System|83
2|1 Economic and Strategic Analysis|83
2|2 Legal and Regulatory Framework|85
3|2.1 Open Access Rules|86
3|2.2 Capacity Assessment Directive|87
3|2.3 Review of ANP Directives # 27/2005 and 28/2005: Directive 11 from 2016|87
3|2.4 Tariff Criteria Directive|88
3|2.5 ANP Directive # 15/2014|88
3|2.6 Brazilian Natural Gas Law|90
2|3 Current Regulatory Issues|91
3|3.1 Tariff Policies|91
3|3.2 Open Access Request and Others Issues by Directive 11/2016|93
2|4 Challenges and Perspectives|94
3|4.1 Pricing Challenges and Perspectives|94
4|4.1.1 Relative Weight of the Transport Price on the Consumer Final Price|95
4|4.1.2 The Price of Natural Gas in the Brazilian Market|98
3|4.2 Open Access and Third-Parties: Challenges and Perspectives|101
2|5 Concluding Remarks|104
2|References|105
1|Regulatory Challenges of Natural Gas Downstream in Brazil|107
2|1 History|107
3|1.1 Duties and Responsibilities|108
3|1.2 Gas Law|111
3|1.3 European Community Law and Regulation in the United Kingdom|112
3|1.4 US Law: Regulation of FERC|113
2|2 Brazilian Regulatory Challenges|114
3|2.1 Flow, Transfer and Distribution Pipelines|115
3|2.2 Regulation of Operational Exchange: Swap|117
3|2.3 Free Consumer|118
3|2.4 State Interconnection|119
2|3 Contractual Challenges|122
3|3.1 Agreement for Purchase and Sale of Natural Gas|122
3|3.2 Transportation Contracts|123
2|4 Systemic Risks|125
3|4.1 Regulatory Risk|125
3|4.2 Tax Risk|126
3|4.3 Market Risk|126
2|5 Conclusion|127
2|References|127
1|The Electricity Sector and the Structure of the Short-Term Market in Brazil|129
2|1 Introduction|129
2|2 The Structure of the Brazilian Electricity Sector|131
2|3 The Market Operator and the Sector´s Multilateralism|133
2|4 Information Principles for the Agents´ Performance in the Electricity Sector|136
2|5 The Jurisdictional Control Over Regulatory Acts|142
2|6 The Issue of the ``Regulation´´ by the Judiciary Branch|143
2|7 The Impacts of Court Decisions on the Short-Term Market|146
2|8 The Increasing Judicialization and the Necessary Discussion of the Market Rules|148
2|9 Conclusion|150
2|References|151
1|Legal Regulation of the Distribution of Electricity in Brazil|152
2|1 Economic and Strategic Analysis|152
3|1.1 Distribution Market in Brazil|152
3|1.2 The Economics of the Distribution Activity|154
2|2 Legal and Regulatory Framework|158
3|2.1 Constitutional Provisions|159
3|2.2 Concession Contracts|161
3|2.3 Tariff Formation and Revision|163
3|2.4 Consumer Protection|166
2|3 Current Regulatory Issues|168
3|3.1 Political Interference|168
3|3.2 Extension of Concession Contracts|170
2|4 Challenges and Perspectives|171
2|5 Concluding Remarks|172
2|References|172
1|Regulatory Framework of Wind Power in Brazil|174
2|1 Economic and Strategic Analysis|174
3|1.1 PROEOLICA and PROINFA|176
3|1.2 Wind Power in the New Energy Model|180
3|1.3 Evolution of Wind Energy Capacity in Brazil|183
2|2 Legal and Regulatory Framework|183
3|2.1 Free Market Environment|184
3|2.2 Regulated Market Environment|188
4|2.2.1 Regulated Energy Auctions|188
4|2.2.2 Reserve Energy Auctions|189
4|2.2.3 Evolution of Competitiveness Based on Energy Price|190
2|3 Challenges and Perspectives|190
3|3.1 Environmental Licensing|191
3|3.2 Connection to the Grid System: Who Will Pay for Wind Farms Not Connected to the Grid System?|192
3|3.3 Regulatory Bottlenecks and the Mathematics of Force Majeure|193
2|4 Concluding Remarks|195
2|References|196
1|Solar Energy and the Dawn of `Solar Cities´ in Brazil|197
2|1 Introduction|197
2|2 Economic and Strategic Analysis of the Solar Energy in Brazil|199
3|2.1 The Emergence of Photovoltaic Energy Systems (EFV)|200
3|2.2 Obstacles to the Development of Photovoltaic Energy Systems (EFV)|202
2|3 Legal and Regulatory Framework|203
3|3.1 Constitutional Treatment of the Potential Exploiting of Solar Energy|204
3|3.2 Public Policies and Incentives Related to the Generation and Use of EFV and Thermosolar|205
3|3.3 Energy Compensation System for Distributed Micro and Minigeneration (Net Metering)|210
2|4 Current Regulatory Issues|212
3|4.1 ``Solar Capitals´´: Search Results|212
3|4.2 A ``Ray of Light´´ in the Brazilian Emissions of Greenhouse Gases (GHG): The Case of the Municipality of São Paulo|220
2|5 Challenges and Perspectives|222
2|6 Concluding Remarks: ``Is There Light at the End of the Tunnel´´?|223
2|References|224
1|Challenges of Social and Environmental Certification of Biofuels in Brazil|227
2|1 Introduction|227
2|2 Certification: Competitive International Commercial Advantage|228
2|3 Environmental Requisites and Market Accessibility: Prevention to ``Green Protectionism´´|229
2|4 World Environmental Labelling and Environmental Labelling in Brazil|232
2|5 Social Seals and Worker Standards|234
2|6 Conclusion|239
2|References|240
1|Regulatory Framework of Nuclear Energy in Brazil|242
2|1 Economic and Strategic Analysis|242
2|2 Organization of the Nuclear Sector|244
2|3 Governance of the Nuclear Sector|247
2|4 Legal and Regulatory Framework|252
2|5 Current Regulatory Issues|254
2|6 Conclusions|259
1|Main Issues of Biomass Energy Regulation in Brazil|262
2|1 Introduction|262
2|2 Legal and Regulatory Framework|264
3|2.1 Regulatory Authorities|264
3|2.2 Upstream Regulation|266
3|2.3 Downstream Regulation|267
2|3 Current Regulatory Issues|268
3|3.1 Ethanol|268
3|3.2 Cogeneration|269
3|3.3 Charcoal and Firewood|270
2|4 Challenges and Prospects|271
2|5 Concluding Remarks|271
2|References|272
1|International Trade in Energy: A Glance at Selected Issues|273
2|1 Introduction|273
2|2 Regulation of International Trade in Energy|274
2|3 Subsidies Within the Energy Sector|276
2|4 Energy Integration in South America|280
2|5 Final Considerations|283
2|References|284