Cuiabá Thermal Power can be used to replace delayed J&F plants, says Aneel

Âmbar Energia can use the Cuiabá thermal plant to cover its delay in the construction of four of its gas plants. The decision was taken this Tuesday (12) at a board meeting of Aneel (National Electric Energy Agency).

Âmbar is the energy arm of the J&F group, which also controls JBS, a global company in the meat sector.

The decision ends a debate that started on May 17, when the company obtained an injunction, a provisional measure, in favor of the operation. The precautionary measure ended up being suspended on June 2 by a monocratic decision by the director-general Camila Bomfim, after Aneel received numerous complaints from representatives of the sector.

By rule, these plants should have come into operation on May 1st. The delay provides for the payment of a fine and cancellation of the contract on August 1, if they do not start operating. To get around the delay, Âmbar offered the Cuiabá plant — an expedient that is prohibited by clause four of the auction rule.

To make the operation viable, the rapporteur of the process, director Efrain Pereira da Cruz, argued that, among other advantages, Âmbar offered a discount in relation to the cost of the original projects. And he asked his colleagues to “remove clause four” of the contest, since it in fact prevents the operation.

Directors Hélvio Guerra and Ricardo Tilli voted with the rapporteur because they understood that there would be a benefit to the consumer. “We always have to observe the public interest,” Guerra said.

The interim director general, Camila Bomfim, presented a dissenting vote. “The fence is very clear. These plants cannot be replaced by others, owned by the owner or by third parties”, she said. “There is no way to look for the classification of the thermal plant in Cuiabá.”

The director-general stressed that approving the thermal plant would jeopardize the credibility of the competition system in the energy sector, since it would “remove conditions provided for in the auction”.

Bomfim also reinforced that the guidelines for the auction were given by the MME (Ministry of Mines and Energy), and that the change would have to be evaluated by the portfolio. According to Sheet found, on more than one occasion the ministry was informally consulted on the issue and took a contrary position.

Privately, Minister Adolfo Sachsida described the measure as absurd, signaling that the ministry could evoke its institutional position as a public policy planner if such an elementary rule of the auction were not complied with.

The agency’s deputy attorney general, Eduardo Estevão Ferreira Ramalho, also made a statement against Âmbar’s request.

Ramalho explained that the auction notice and the contract with the company require that energy be delivered by the new plants. Considering that the Cuiabá thermal plant has been operating for 21 years, it would not be qualified.

The agency’s technical area took a stand twice against Ámbar’s request. In the most recent demonstration, ratified by three different sectors, the analysis identified that meeting Ambar would go against eight legal provisions.

Sought by the report, Âmbar did not manifest itself until the publication of this text.​

The entity that represents large consumers regretted the decision.

“The arguments brought by directors of Aneel, and presented as favorable to consumers, do not reflect the real interests of those who pay the energy bill”, said the text of Abrace (Association of Large Industrial Consumers of Energy and Free Consumers)

“If the contracts can be aggressively breached or interpreted in order to authorize the exchange of energy, as the agency interpreted, it would be better to allow the adoption of solutions indicating the non-generation of the projects and payment only for the generated capacity, because there is no need to penalize consumers with an unnecessary cost of purchasing fuel.”

Anace (National Association of Energy Consumers) understands that consumers are being greatly harmed by Aneel’s decision. For the entity, the solution would be to follow what is defined in the PCS contracts, including the payment of fines by the plants that were not able to meet the assumed deadlines. “We understand that resources are available both at Aneel and at the Ministry of Mines and Energy against the decision”, evaluates the association’s director-president, Carlos Faria.

Âmbar’s four thermal plants are part of a group of 17 plants (14 with gas and 3 with renewable raw materials) that won, in October last year, a new type of auction — the PCS (Simplified Competitive Procedure).

As the deadline for operating on May 1st was short, companies had an incentive: the right to receive high amounts for energy. There will be R$ 39 billion to operate by the end of 2025.

The company that signed the largest volume of contracts in the auction was EPP (Evolution Power Partner). Its four thermal plants, Edlux 10, EPP 2, EPP4 and Rio de Janeiro 1, account for 43% of the energy traded, at a cost of almost R$ 18 billion.

Subsequently, EPP sold these four plants to Âmbar, which began to look to Aneel for alternatives to overcome the delay in the works.

A survey presented by Aneel technicians also identified that the Âmbar plants would be ready in October, almost three months after the final limit.