Tuesday, May 24

Electrobras: The Brazilian Senate approves the privatization of the largest electricity company in Latin America | International

The Federal Senate approved on Thursday night the provisional measure that allows the privatization of Eletrobras, the Brazilian state company responsible for about 40% of transmission and 30% of power generation in the country – it is the largest company in the country. electricity sector in Latin America. The project approved by the senators will cost between 40,000 and 66,000 million reais (about 8,000 million dollars) to the public coffers, according to a group of 45 entities from the energy and industrial sectors. And the profits would be 61,000 million reais (about 12,000 million dollars).

These institutions, which have joined the United for Energy movement, estimate that the final consumer’s electricity bill will increase by around 10%. The government of Jair Bolsonaro, in turn, says that the electricity bill will be lower, but did not present data to show how much this reduction would be. Before the latest changes to the provisional measure, the estimate was that the decrease would be approximately 7%.

The project underwent a series of modifications, many of them unrelated to the original theme of the text. The inclusion of what is called “jabuti” in Congress has sparked a wave of criticism, from politicians to experts. Now the project returns to the Chamber of Deputies, which will have to approve it in record time, five days, two of these are at the end of the week. The measure expires on June 22, and if it is not voted on, it will have no validity. On Thursday night, the Speaker of the House, Arthur Lira, called a session of the House for Monday, the 21st, with the aim of approving it.

The Senate green light passed with a result of 42 votes in favor and 37 against. Despite the tightness of the result, it was a victory for the Bolsonaro government and for the Minister of Economy, Paulo Guedes, who since the beginning of his mandate has been selling investors an ambitious privatization plan, which has not yet taken off. . The parties that voted against, such as the Workers’ Party – PT and Podemos, must go to court because they understood that there were no constitutional requirements for the processing of the proposal, such as the urgency necessary for the issuance of a measure like this .

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Among critics of the measure, the assessment was that the project was half liberal, half interventionist. At the same time that it authorizes the federal government to reduce its participation in the company from 61% to 45% of the shares, it establishes a kind of market reserve for thermal power plants –the most polluting and most expensive– in the regions where gas pipelines they are non-existent or scarce, like the north, the northeast and the center-west. “He’s a monster,” defined Senator Tasso Jereissati from the Brazilian Social Democracy Party – PSDB.

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For comparison, a megawatt-hour of renewable energy, such as solar and wind, costs about 100 reais (roughly $ 20). That of the thermoelectric plants, between 320 and 350 reais (about $ 69). “The premises used by the Government that there will be a reduction in prices were wrong. Only with the use of thermoelectric plants can it be concluded that the energy will be more expensive ”, affirms the coordinator of the Climate and Society Institute, Roberto Kishinami. However, the bill for this readjustment will not appear until three or four years from now, when the thermal power plants start operating. “By then, people will have forgotten even what has been decided today,” reflected the researcher and former president of the National Electric System Operator (ONS) Luiz Eduardo Barata.

The text approved last month by the Chamber had already suffered resistance from the electricity sector and consumer representatives. In the Senate the assessment was that there was an even greater setback. “It worsens what was already bad and foresees new costs for Brazilian consumers,” the Union for Energy said in a statement. Filipe Soares, one of the group’s spokesmen, told EL PAÍS that the initial text of the deputy had good arguments, but that it was deconstructed in Congress. “We were horrified by what was passed in the House and what the Senate is changing. Putting thermoelectric plants in the North region is unnecessary. It is a region that has more energy generation than consumption ”, he said.

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Senator Rodrigo Pacheco in front of a screen with Senator Marcos Rogério, during the vote on the Eletrobras measure.
Senator Rodrigo Pacheco in front of a screen with Senator Marcos Rogério, during the vote on the Eletrobras measure.Pedro France/Ag. Senate

In the opinion approved by the Senate, the speaker Marcos Rogério of the Democratic Party – DEM maintained the obligation to contract 6,000 megawatts of natural gas plants. Spending on thermal energy will end up growing even more in the country. Last month, the National Electric Power Agency – Aneel authorized an increase in the energy rate due to the low level of the reservoirs due to the lack of rainfall in the Southeast and Midwest regions. “With the capitalization we will return to Eletrobras its investment capacity”, defended Rogério.

In the evaluation of the specialists, the changes in the MP demonstrated an interference by the Legislative in a sector that depends on planning and is constantly regulated. “It is not reasonable for the Legislative to do the planning of the electricity sector in the country,” reflected researcher Barata. An amendment presented by the president of the Senate, Rodrigo Pacheco, still determined that the president of the ONS (national operator of the electricity system), which is a private non-profit association, must be examined by the Senate.

The inclusion of this issue in the MP that dealt with the privatization of Eletrobras is another example of external issues that ended up being discussed outside the initial context of the project. “There was a break in the governance structure of the system,” analyzed the executive director of the Institute for the Defense of the Consumer (Idec), Teresa Liporace.

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The summary on the amount of approved foreign affairs was such that the leader of the women’s group in the Senate, Simone Tebet, of the Brazilian Democratic Movement – MDB, ironically summarized, using various popular dictates, Thursday’s session on her networks: “The whole herd is passing in the Eletrobras MP. The fauna is complete: There is an ox in the line (allusion to the railway motorcyclists when they saw an ox on the railway line and saw the communication cut off), a jabuti in the tree (allusion to something impossible, unusual situation), a goat in the room (allusion to an uncomfortable situation), a dose for an elephant (implies that you have to be very patient) and a stubborn as a mule. But what else is there is wolves in sheep’s clothing. The truth is that millions of Brazilians go pro brejo (Another popular dictation that means that a situation is going to get worse), due to the increase in the bill ”. The coordinator of the Idec energy and sustainability program, Clauber Leite, followed the same line. “Today there has been talk of everything except the privatization of Eletrobras.”

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