Instituto Internacional Arayara de Educação e Cultura vs. Federal Union, Ministry of Mines and Energy and Others

In March, 2026, the Arayara International Institute of Education and Culture filed a Public Civil Action (ACP) with a request for a preliminary injunction against the Federal Government, the Ministry of Mines and Energy (MME), the Energy Research Company (EPE), and the National Electric Energy Agency (ANEEL) due to the inclusion of coal-fired thermoelectric plants in the 2026 Capacity Reserve Auction in the Form of Power (LRCAP 2026). It argued that the aforementioned auction, conducted by the MME, presents flaws in its justification and deviation from its purpose by allowing the participation of coal-fired plants in a mechanism intended for contracting flexible power to meet peak demand in the National Interconnected System. It also argued that these plants lack the technical capacity for rapid response due to their low operational flexibility, long start-up times and need for continuous operation, which disqualifies them as a suitable source for capacity reserve.

The complaint alleged that the auction model unduly favors these power plants, guaranteeing longer operating times and revenue predictability, which generates competitive distortions, risks of tariff increases, and potential future litigation. It also highlighted that this structure encourages the maintenance of highly emitting sources, increasing greenhouse gas emissions and exacerbating the impacts of climate change. Finally, it argued that the inclusion of coal contradicts climate commitments made by Brazil, the National Energy Transition Policy, and the constitutional principles of environmental protection, constituting environmental regression and incompatibility with the transition to a low-carbon energy matrix.

The complaint seeks a preliminary injunction to suspend the administrative act by the Ministry of Mines and Energy (MME) that included the possibility of participation by coal-fired thermal power plants in the LRCAP 2026 (Brazilian National Auction for the Reduction of Coal-Fired Power Plants). Additionally, it requests the subsequent exclusion of proposals by similar projects, as well as the prohibition of any acts that would continue the auction with regard to such plants. On the merits, the plaintiff requests that the action be granted to declare the nullity of the administrative acts that authorized the inclusion of the coal-fired thermal power plants in the LRCAP 2026, with their definitive exclusion from the bidding process, as well as the permanent prohibition of any acts continuing the auction in relation to these projects.