With the reforms in the 1990s, a Secretariat for Water Resources (Secretaria de Recursos Hídricos: SRH) was created in 1995. Working together with Congress, it was possible to draw up a law which contained the principal technical elements of what had been discussed, although some points of conflict remained. In 1997, the law on water resources was finally approved after lengthy negotiation amongst the sectors involved. Having approved the legislation, the next step was to was to put it into practice. Within government, a second reform was being drawn up, leading to the creation of agencies for the control of sector development, once the ministries had defined their policies. This agency of control was the National Water Agency ANA (Agência Nacional de Águas), created on 17 July 2000. The main responsibilities of ANA include: granting concessions for water use in Federal rivers; flood and drought prevention; accounting for water use in Federal rivers; stimulating creation of committees for drainage basin management. As regards hydropower, the National Agency for Electrical Energy (Agência Nacional de Energia Elétrica –ANEEL) works together with ANA to ensure that reserves defined for energy production are maintained. With the creation of ANA, the law concerning compensation for flooded land was changed to provide funds for the sector, with ANA receiving 6.75% of the value of energy generated. Science and Technology applied to water resources received 3.67% of the compensation funds.
These are considerable sums for a sector which, before the passing of legislation, had been funded by budget oddments. It can be said that the construction of the first phase (here termed Phase I) of institutional development of Brazil’s water resources is now concluded. In it, legal elements have been established at Federal level for management, and institutions for governance have been set up. At State level, almost all States have passed legislation, and some have set up agencies for development, although at present these are rather few in number.