Brazil's Record Power Auction Drives Demand for LNG Infrastructure

The largest power auction in Brazilian history has shaken up the energy sector. In March 2026, the capacity reserve auction (LRCAP) contracted 65 new thermal power plants and five hydroelectric expansion projects across more than 10 states, with investments totaling 64 billion reais ($12.5bn).

The LRCAP is driving demand for liquefied natural gas (LNG) regasification terminals, gas pipelines, and turbines and engines. A large portion of the contracted projects involve thermal power plants (UTEs) powered by LNG, including in areas without existing regasification terminals.

Eneva, the largest winner of the auction, will install new floating storage and regasification units (FSRUs) to serve several plants in Ceará and Espírito Santo. Other companies, such as Oncorp and Âmbar Energia, will also bring FSRUs to supply thermal power plants.

The Natural Gas Pipeline Transportation Companies Association (ATGás) expects investments in the gas transportation network to grow significantly. TAG's Sergipe Hub, which supplies around 15% of the Northeast's energy demand, and TBG's expansion with new delivery points planned between 2028 and 2031, are key highlights.

The auction is also stimulating demand for turbines and engines for gas-fired thermal plants, particularly small-scale ones. Origem Energia contracted five 10MW thermal plants in Alagoas with an investment of 212.7 million reais and engines from Wärtsilä.

In hydropower generation, the LRCAP contracted expansions at several plants owned by Engie, Copel, SPIC Brasil, and Axia Energia. The five projects total 2.9GW of additional capacity and 11 billion reais in investments, with start of operations scheduled for 2030 and 2031.