BRAZIL · ENERGY
Key Facts
- —The country Brazil is Latin America’s largest economy, and Greater São Paulo, its business capital, holds more than 20 million people.
- —The background Three major storm blackouts since 2023 hit the city’s grid, run by Italy’s Enel, the worst in December 2025.
- —Why now ANEEL, the federal electricity regulator, opened a procedure in April that could cancel Enel’s contract before it expires.
- —What happened On Tuesday, 6 October, rapporteur Agnes Costa recommended ending the concession, then a fellow director requested more time.
- —The numbers Enel’s São Paulo unit serves about 8.2 million customer connections, and its contract runs until 2028.
- —What it means for you Funds holding Enel face Brazilian regulatory risk, and US firms in São Paulo depend on this grid.
- —Still open When the vote resumes, how the other directors vote, and what the energy ministry finally decides.
A recommendation to strip Enel of its São Paulo grid now waits on one director’s review, then on the federal government.
Brazil’s electricity regulator moved closer on Tuesday, 6 October, to ending the Enel São Paulo concession. The contract covers the power grid of Brazil’s largest city and its suburbs.
Agnes Costa, the director handling the case at the regulator, known as ANEEL, recommended cancelling the Italian group’s licence early. A fellow director, Gentil Nogueira, then asked for more time to study the file, which suspended the vote.
For US readers, the case tests how far Brazil will go against a foreign-owned utility over poor service. Enel is a Milan-listed Italian power group with large businesses across Latin America, including Chile and Colombia.
What the Rapporteur Recommended
Costa, a member of the regulator’s board, voted to recommend a declaration of caducidade to the Ministry of Mines and Energy. The Portuguese legal term means cancelling a public concession because the operator failed its obligations.
Ludimila Lima, a substitute director, backed the recommendation, according to the specialist infrastructure outlet Agência iNFRA. That makes two board votes in favour so far, with the remaining votes still pending.
“The concessionaire already knew the risks, it had already been formally warned,” Costa said, according to Brasil de Fato. She said her conclusion rested on several converging findings, not one event.
She cited slow emergency crews, weak crisis management and too few workers, and said repeated attempts to fix them had failed. She also rejected Enel’s argument that the December 2025 storm was an exceptional, unforeseeable event.
Three Blackouts Behind the Case
The case grew out of repeated, long outages after storms in Greater São Paulo. Since 2023 the region has suffered three major blackouts, Brasil de Fato reported.
The worst came in December 2025, when more than 4 million properties lost power. That is roughly half of all the customer connections Enel serves there.
ANEEL opened the formal procedure in April 2026. On Tuesday, 29 September, it rejected Enel’s request for an independent technical review, which it said closed the evidence phase.
How Enel Defends Itself
Enel says its service has improved sharply since the worst outages. In final arguments filed in August, it cited a 73% rise in investment and a 31% increase in staff and contracted services.
It said outages longer than 24 hours fell by 90% up to June 2026, Mercado & Consumo reported. It argues that other distributors also struggled after the same storms.
Enel has also fought the procedure in court. It asked a federal court to annul a 24 February vote by ANEEL’s director-general, Sandoval Feitosa, Agência iNFRA reported.
The Government Already Plans for an Exit
The same day, the energy ministry asked ANEEL to name an official to plan continued supply in São Paulo. The letter came from Mariana Espécie, the ministry’s national secretary for energy transition and planning.
Both bodies must send a timetable of actions to the TCU, Brazil’s federal audit court, by Friday, 27 November. The planning covers the end of the Enel São Paulo concession, whether it comes early or at expiry in 2028.
What It Means for You
For investors, the case shows that Brazilian regulators can move against a foreign utility over service quality, not only over finances. That is a risk factor for any fund holding Enel or Brazilian power distributors.
Enel chose to leave the New York Stock Exchange in 2007, and its Latin American arm, Enel Américas, followed in June 2022. US exposure runs mainly through international equity funds.
US companies with offices, plants or data centres in Greater São Paulo depend on this grid. Any change of operator would be planned to keep power flowing, which is what the ministry’s letter is about.
For travellers, nothing changes now, though the big outages followed storms between October and December.
What Is Not Known
ANEEL has not announced when the vote will resume after Gentil Nogueira’s review. It is also not known how the remaining directors will vote.
Enel’s reaction to the recommendation itself is not yet known. Whether it will challenge a final decision in court, or try to sell the concession instead, is unclear.
Who would run the grid in a transition is also open, with a temporary administrator or a new tender among the options.
What Comes Next
Gentil Nogueira will return the case to the board, which will then finish the vote. If a majority backs Costa, the recommendation goes to the Ministry of Mines and Energy, which has the final say.
The next fixed date is the 27 November deadline for the timetable to the audit court. Tuesday’s vote does not cancel the contract, and Enel keeps running the grid for now.
Frequently Asked Questions
What is Enel São Paulo?
Enel Distribuição São Paulo is the Italian group Enel’s local unit that delivers electricity in Greater São Paulo. It took over the former Eletropaulo in 2018 and serves about 8.2 million customer connections.
What does caducidade mean?
It is the Brazilian legal procedure for cancelling a public concession before it expires because the operator failed its obligations. ANEEL can only recommend it, and the federal government decides.
Will São Paulo lose power if Enel loses the contract?
No change of operator is planned without a transition. The energy ministry has already asked the regulator to plan how distribution continues as the contract ends.
Who makes the final decision?
The ANEEL board votes on a recommendation, and the Ministry of Mines and Energy takes the final decision. Enel can challenge the outcome in Brazilian courts.
Sources: ANEEL, decision of 29 September 2026; ANEEL presentation to the Chamber of Deputies, 2024; Enel Américas, NYSE delisting notice; Enel, NYSE delisting release, 2007; Brasil de Fato; Agência iNFRA, vote; Agência iNFRA, ministry letter; Agência iNFRA, court challenge; Mercado & Consumo (all accessed 7 October 2026).
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief