Highways: government wants to contract BRL 300 billion in investment – 06/15/2023 – Market

The Ministry of Transport presented this Thursday (15) a new road concession policy. During the announcement, it was informed that the Lula government intends to contract BRL 300 billion in investments in the sector until the end of the mandate, in 2026.

Ministry representatives also said that they plan to invest, by the end of the mandate, R$ 70 billion in road recovery through Dnit (National Department of Transport Infrastructure) and, of this amount, R$ 20 billion will be disbursed in 2023 .

The new concessions policy, anticipated by the Sheetenvisages changing the auction format and creating options to prevent operators from having problems closing accounts during the contract period.

According to George Santoro, executive secretary of the Ministry of Transport, of the 15,000 kilometers of highways currently under concession in the country, 10,000 have a problem, whether they are being returned by the concessionaire for re-bidding, imbalance in contracts or some other issue.

In an interview with journalists, the secretary stated that the ministry has been talking with the TCU (Union Court of Auditors) and with the concessionaires of federal highways to carry out changes in the current contracts. The issue will be the subject of a judgment on June 21.

The ministry hopes that, if approved by the TCU, the readjustment of these contracts in the manner that the government will implement for future auctions will promote a resumption of investments by the concessionaires, in addition to attracting new investors.

The government also intends to streamline the analysis of questioning of the contracts. The new policy will make room for an automatic rebalancing of the terms, even before the end of the analysis of the request by the regulatory agency. “If the agency agreed with the merit, but did not conclude the technical analysis, we automatically rebalance a percentage”, explains Viviane Esse, national secretary of Road Transport.

The policy was presented at an event at B3, in São Paulo, with the presence of members of the government, investors and dealership representatives. At the meeting, Luciana Costa, director of infrastructure at the BNDES, said that the bank plans to expand the financing of road concessions and reduce the time taken to analyze applications. “We have a lot of appetite to finance and we are available to discuss financing conditions.”

“The capital market plays a relevant role, but our economy is very unstable. A project in Brazil eventually takes two years to structure and another two years to finance. We are trying to change that,” he said.

Under the new model, the auction criterion will be the lowest tariff, without the payment of a grant. In the event of a tie, competitors will have to make contributions if the discount exceeds 18% of the minimum tariff. The money from these contributions can only be used in certain situations, such as new works or to deal with problems such as a drop in demand or higher prices for inputs.

The contracts must also provide for the implementation of technological changes such as discounts on the toll rate for frequent users, which can reach 30%, and the replacement of toll plazas by the mechanism known as “free flow”: sensors installed along the highway monitor cars and charge the driver for the distance travelled. Adoption of the model would have to occur by the fifth year of the concession.

Another measure to help concessionaires close accounts is to encourage them to carry out more projects in the domain ranges, name of the land beside the highways. A possible model is to create malls or service centers there and use the revenue obtained to reduce the toll fee.

“We see experiences outside Brazil in which real estate [negócios com imóveis] sometimes represents 15%, 20% of the project’s revenue”, says Esse. The secretary points out that undertakings can expand the service options for truck drivers, such as rest points, and generate jobs along the highway.

There is also a determination that the new concessions have initiatives aimed at sustainability, such as charging points for electric vehicles in spaces to support users.

According to Santoro, the Transport department has spoken with representatives of companies from Spain, Canada, Portugal, Italy, Switzerland, China, India, Australia, Argentina, Uruguay and Colombia who have shown interest in investing in the new model of concessions.

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BIDDING NOTICES FOR FEDERAL ROAD CONCESSIONS FOR 2023

Paraná – lot 1

• 473 km of roads
• BRL 7.9 billion in works
• BRL 5.2 billion in operating expenses
• Status: Already published, auction on August 25

Paraná – lot 2

• 604 km of roads
• BRL 10.8 billion in works
• BRL 6.5 billion in operating expenses
• Status: Already published, auction on September 29

BR-381 (BH to Gov. Valadares)

• 304 km of roads
• BRL 5.2 billion in works
• BRL 3.6 in operating expenses
• Status: Announcement scheduled for the 2nd semester

BR-040 and BR-495 (Rio-BH)

• 451 km of roads
• BRL 9.2 billion in works
• BRL 6.7 billion in operating expenses
• Status: Announcement and auction scheduled for the 2nd semester

BR-040 (GO-MG)

• 594 km of roads
• BRL 6.1 billion in works
• BRL 5 billion in operating expenses
• Status: Public notice scheduled for the 2nd semester

All with concessions for 30 years.
_{Source: Ministry of Transport}