Electric sector asks for subsidy reduction and criticizes congressional intervention

Electric sector associations ask for a reduction in subsidies paid to the electricity bill and criticize threats of intervention in tariffs by Congress, which even discussed the suspension of readjustments by means of a legislative decree.

In a document addressed to candidates for the presidency of the Republic, Fase (Forum of Electric Sector Associations) listed among the sector’s priorities the reduction of sector charges charged on the electricity bill to pay for subsidies.

This year, the main of these charges, the CDE (Energy Development Account) will cost consumers R$ 30.2 billion, according to a budget approved by Aneel (National Electric Energy Agency).

This account finances subsidies for renewable energy, low-income consumers and isolated power generation and systems in the North of the country. The generation of energy using mineral coal and investments in rural electrification are also benefited.

“The charges distort prices and mask the true value of energy: some pay cheaply for an expensive good, and many pay dearly for a good that should be cheap,” Fase claims. “Charge ultimately means transfer of income without transparency.”

The association also cites a charge known as ESS (System Services Charges), which is charged to pay for the use of thermoelectric plants and cost R$ 26.2 billion in 2021.

“Fase understands that it is urgent to prioritize the reduction of charges, placing the systemic benefits of this resolution above the individual and specific interests that supported its creations, normally in law”, says the forum, which brings together 20 associations of companies and energy consumers.

At an event that brought together representatives of the sector in Rio, the deputy director general of Aneel, Camila Bomfim, said that the reduction of subsidies is one of the agency’s priorities, but the sector complains that Congress has made this mission difficult with the approval of new benefits in laws.

One of them was the obligation to contract thermal energy included in the Eletrobras privatization law, which will charge the electricity bill even in rainy periods, since these plants can have a high level of inflexibility.

The performance of the Congress on the sector is a great cause for concern, stressed the president of ABCE (Brazilian Association of Electric Energy Companies), Alexei Vivan. For him, initiatives such as the legislative decree that provided for the suspension of readjustments in 2022 create legal uncertainty.

“These are electoral issues that in the short term may represent a reduction in the price of energy, but are not sustainable in the long term”, said the executive, who believes that Congress’ actions are facilitated by a “vacuum” left by the lack of action by the Executive. on topics within its competence.

“Power does not admit a vacuum”, he said, defending the resumption of the leading role of the Ministry of Mines and Energy and Aneel in matters of the electric sector.

The very relationship between the various segments of the sector was pointed out at the event as one of the pressure factors on tariffs, as it allows lobbies to gain strength to support new subsidies that will make the electricity bill more expensive, as occurred in the Eletrobras PM.

“Most of the brains here are not looking for the sector’s efficiency,” said the president of Abrace (Brazilian Association of Energy Consumers), Paulo Pedrosa, for whom each group has worked separately to ensure benefits.

“In the coming years we need to work to dismantle this movement, to ‘dejabutize’ the electric sector”, he added, referring to the so-called “tortoises”, articles included by lobbies in laws generally unrelated to the theme.

The sector, however, considers it right to postpone the analysis of the tariff readjustment of Cemig, a distributor that serves Minas Gerais, extended this Tuesday (7) by Aneel awaiting the conclusion of processes that can reduce the percentage of increase.

The deputy director general of the agency explained that the objective is to await the privatization of Eletrobras and the sanction of the project approved by Congress that guarantees the return of PIS Cofins to electricity distributors.

The two processes will represent an injection of resources in the sector, reducing the need for readjustments. Cemig, says Bomfim, is one of the companies with the highest volume of PIS/Cofins receivable. She stressed, however, that the adjustment cannot take long, as the company has bills to pay.