The Brazilian Government is reportedly planning to deregulate the country’s power industry.
Media reports suggest President Michel Temer’s administration aims to reverse a framework which imposed heavy losses on the sector when it was originally introduced in 2012.
The initiative aimed to force down electricity prices in exchange for the early renewal of operating licenses.
Energy Ministry Planning Secretary Eduardo Azevedo reportedly stated an executive decree later this year would scrap the scheme, expand unregulated power markets and simplify taxes.
The changes are said to allow power generators to freely sell their output at higher rates and with fewer restrictions on the length of contracts, as well as cutting subsidies to renewable energy sources.
The new framework would also free the state-owned utility Centrais Elétricas Brasileiras SA from price restrictions on power produced by the nation’s hydropower dam in Itaipu.
The move is the latest in a series of reforms sought by the President as he seeks to improve the business climate and boost investment in the Brazilian Economy.
Brazil generates the third highest amount of electricity in the Americas, behind only the US and Canada.