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Order to end the water/power crisis in Brazil?

Rafael Herzberg's picture
Consultant energy affairs Self employed

Rafael Herzberg- is an independent energy consultant, self-employed (since 2018) based in São Paulo, Brazil* Focus on C level, VPs and upper managers associated to energy related info, analysis...

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  • Oct 16, 2021

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Order to end the water/power crisis in Brazil?

News that circulated in the main portals in the country, this last Friday, reveals that Bolsonaro (the Brazilian president) says he will order the end of the water scarcity red flag next November. This flag is the mechanism by all energy users pay an extra fee per kWh so that it is feasible to dispatch thermal (more expensive) power plants (as compared to the hydro ones).

The electricity sector is operated according to regulation established by ANEEL and dispatchedby the ONS (National System Operator).

If Bolsonaro orders this, who will pay for the dispatch of the thermal plants that are so necessary to ensure the supply of the SIN (National Integrated System) since the hydro cannot be dispatched (dry reservoirs)?

I hope the portals that published the news investigate further this issue because, in the way stated, the certainty is the lack of respect for the agreed upon regulations.

And worst of all, it would open a very serious institutional crisis affecting national and international investors because there would be an open disrespect to the established legal framework.

Is this what we want?

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