BRAZIL’S PARANA STATE HAS cancelled the planned privatisation of state power utility Copel. Parana said the decision to cancel the process was the result of the international scenario, the situation in Argentina and undefined local energy sector rules, which scare off foreign investors.

The attempts to sell Copel failed twice last year due to a lack of interest by bidders. Recently, Brazil has announced a number of measures aimed at increasing its role in the power sector, including a postponement of opening the electricity market to the private sector.

Parana government said that the postponement of market restructuring meant that Copel could remain in state hands.

Copel has 17 hydroelectric plants and one thermal plant with a total capacity of over 4500MW, which account for about 7% of Brazil’s power generation capacity.