Brazil's ONS warns capacity auction falls short and taps Itaipu as reserve amid El Niño

The National Electric System Operator (ONS) said the recent Capacity Reserve Auction (LRCap) secured about 19.5 GW of contracts lasting up to 15 years but did not resolve the grid’s stability challenges. Planning director Alexandre Zucarato highlighted that the rapid growth of renewable sources, especially solar, has intensified the “duck‑curve” effect, increasing the need for quick‑response generation and greater flexibility. ONS expects a future battery auction to help improve system stability.

Anticipating reduced rainfall in Brazil’s North and Northeast due to an upcoming El Niño, ONS announced a strategy to preserve water in the Itaipu dam and other southern reservoirs. By keeping Itaipu’s storage higher now, the plant can serve as a national energy reserve and supply additional power when hydroelectric output from Santo Antônio, Jirau and Belo Monte declines later in the year.