Consumer entities want to stop auction of ‘thermal tortoises’

A group of entities representing consumers is preparing the formation of what it calls a broad front to defend those who pay the electricity bill in the electricity sector. Officially, the front should be launched at the beginning of August, but the entities are already starting some initiatives that seek to defend the consumer against extra costs that they consider unjustified.

According to Luiz Eduardo Barata, a consultant for the iCS (Instituto Clima e Sociedade), this new front has already elected three flags. Initially, the entities will act through administrative means in different bodies, but they do not rule out, in the limit, discussing the different issues in Justice.

The first initiative is to stop the process that leads to the construction of 8 GW (gigawatts) of gas-fired thermal plants provided for in the law that allowed Eletrobras to be privatized. This includes suspending the first auction of these projects, already scheduled for September.

The entities prepared correspondence to request the suspension from the MME (Ministry of Mines and Energy).

Nicknamed “thermal tortoises”, because they were included in the project in spite of the original proposal, they must be built where there is no gas and far from consumer centers, with the costs being passed on to the electricity bill.

This geographic characteristic requires the construction of pipeline networks to carry the gas and transmission lines to extract the energy, which also tend to generate additional costs for the citizen, without a reasonable justification, evaluates Barata.

“These 8 GW did not come from any project, EPE [Empresa de Pesquisa Energética, responsável pelo planejamento do setor] never pointed out the need,” says Barata. “And no one asked consumers if they wanted to pay for it.”

As the lobby in the current Congress was strong in favor of these thermal plants, the entities believe that they may be able to reverse this cost after the election, with the renewal of part of the composition of the parliament.

Abvidro (Brazilian Association of Glass Industries), Abrace (Association of Large Industrial Energy Consumers and Free Consumers), Anace (National Association of Energy Consumers), Instituto ClimaInfo, Idec (Brazilian Institute for the Defense of Consumer), Instituto Pólis and Conacen (National Council of Electric Energy Consumers).

The other joint action of the entities, which is also underway, is to pressure Aneel (National Electric Energy Agency) to take more energetic measures in relation to the thermal plants of the PCS (Simplified Competitive Procedure).

This auction, held in October last year, authorized the construction of 17 plants, 14 of which are gas-fired, to function as insurance for blackouts in the event of a drought at the hydroelectric plants. According to projections, its operation would cost an additional BRL 39 billion in the electricity bill between May 1 of this year and the end of 2025.

The first step, says Barata, is to appeal to Aneel to overturn the decision that benefited Ámbar Energia. With four thermal plants behind schedule, which account for half of the expense, the company obtained authorization to sell energy from another plant, the Mário Covas thermal plant, in Cuiabá (MT), while the works are finished.

The entities understand that the decision harms the consumer, creating a high and unnecessary bill, in addition to hurting the auction notice.

At the same time, they will ask for strictness in dealing with the other thermal plants. “It needs to be clear that anyone who doesn’t enter by July 31 is out,” says Barata. “And those who enter, in our understanding, pay a fine if they enter late, and receive a fixed installment. The system does not need this generation now, nor does it pay for it.”

The third long-term action point is to promote a review of the regulatory framework that can modernize the sector and allow energy costs to be reduced. In this context, the bill 414 that is being processed in the Chamber, and should not advance further this year, is seen as a beginning.

One of the issues is to review the CDE (Energy Development Account). Within it now are a series of subsidies that, according to the entities, need to be reviewed, such as irrigation for agribusiness and incentives for renewable energies that are already economically viable. The growth of these items has been going on for a few years, but has recently been accentuated by lobbying.

Spending on charges rose from BRL 16 billion in 2017, an amount already considered high, to BRL 24 billion in 2021. This year, it is BRL 32 billion.

“We need to separate what is a political decision and what is public policy”, Mariana Amim, director of Anace.