Transition studies ways to reverse the obligation to hire tortoise thermal plants

The transitional government is contrary to the obligation to contract 8 gigawatts (GW) of thermoelectric plants embedded in law nº 14,182 and is studying three ways to reverse this, such as infralegal changes or a new law, Maurício Tolmasquim, who is part of the group, told Reuters dealing with Mines and Energy issues.

In order to prevent billionaire costs of gas pipelines for these thermal plants from being incorporated into the energy tariff by Congress, the group will also propose the postponement of voting on projects, such as PL 414, which deals with the modernization of the electricity sector, he added.

According to Tolmasquim, the first question to be evaluated is whether, according to the text of the law, the government is effectively obliged to contract the 8 GW of installed capacity established, or whether it would be enough just to carry out the bidding processes for this purpose, regardless of their results.

This is a legal interpretation that was already being analyzed by the current management of the Ministry of Mines and Energy, after the first auction of thermal plants under Law No. 14,182 was empty in Piauí and Maranhão. For this thesis, the government would not need to hold new competitions until it manages to hire thermal plants in these states.

He stated that there are already some opinions and legal opinions that support this hypothesis, that it would be “the best way” to reverse the tortoise of thermal plants that, inflexible, would have to operate all the time, burning gas even when the country has other sources more cockroaches.

If it is not feasible, other possibilities would be to amend the decree that regulated Law No. 14,182 or enact a new law.

“The government, taking office, will be able to analyze this more calmly, see what is the safest measure from a legal point of view,” he added.

Regarding the projects already contracted, Tolmasquim highlighted that the contracts will be respected. “They [as térmicas] are guaranteed, because we want to respect the contracts made, no matter how absurd they may be”.

This Monday, former minister Marina Silva, who is part of the transition group for the environment, commented on the topic on her Twitter, saying that the reversal of contracting thermal plants is being evaluated by the government.

Citing billionaire costs of operating these thermal plants and building gas pipelines for these projects, she said that there would be R$ 117.2 billion in “avoidable” government spending in the next administration of President Lula.

COST OF GAS PIPELINES

The next government also wants to prevent Congress from now approving measures that add billionaire costs to the electricity tariff for the construction of gas pipelines that would serve thermoelectric plants in the interior of the country, said Tolmasquim.

“We think it would be very bad if this proposal were incorporated into any of the bills. There are estimates that the cost would exceed R$80 billion.”

Different ways of financing the expansion of the gas pipeline network across the country have already been raised by Congress, mainly under the nickname “Brasduto”. This amendment was included, for example, in the Gas Law, but was rejected by the legislature.

To prevent new initiatives from parliamentarians in favor of the measure, the group is proposing to postpone the vote on PL 414, a bill that deals with the modernization of the electricity sector and that may receive amendments with the “jabuti” of the cost of gas pipelines.

“In the case of 414, as a matter of prudence, we are proposing to leave the approval to the next government”, stated Tolmasquim, adding that the project involves very relevant issues in the electricity sector and there is no urgency to be appreciated this year.

Tolmasquim, who is a former president of EPE (Empresa de Pesquisa Energética), stated that the construction of thermal plants as proposed by law —in regions far from gas reserves and load centers—, as well as gas pipelines to “interiorize” the gas, have no economic logic and serve the particular interests of entrepreneurs in the sector.

He defended that the sector needs to expand its thermoelectric park with flexible plants, that is, that work according to the demand of the electric sector –in periods of bad hydrology and lower solar and wind production– and that have adaptable generation, with quick start-up, for example.

“There will be times when you have a lot of wind, solar or hydroelectric generation and you have to burn the gas unnecessarily. This has an impact both on the consumer, who will pay for fuel unnecessarily, and on the environment, because they emit a lot (carbon dioxide)” .

PCHS

Tolmasquim also assessed that the obligation to contract small hydroelectric power plants (PCHs), also included in Law No. 14,182, violates economic logic, constituting a market reserve for the source and harming competition.

“The primary focus is the issue of thermoelectric plants, but if the solution (to revert the obligation to contract) is a law, eventually the issue of the PCH may be incorporated”, he said.