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Proposal to reduce power costs in Brazil

The National System Operator (ONS) shows that, during the dry season, the hydroelectric reservoirs are "stressed". Thermal plants are then dispatched to meet all demand. 

Since the nominal capacity of the reservoirs is small, the history of recent years shows that the thermal power plants end up being dispatched for many months each year. The cost of the thermal power plants is triple that of hydroelectric plants.

My suggestion is to come up with a program to encourage electricity consumers to use other sources, such as gas or solar, in exchange for a hefty financial reward. 

The ONS would generate a significant gain since the cost to dispatch the National Integrated System would be substantially lower than would have been incurred in the absence of this proposed substitution.

Win-win situation! I have already imagined what this contract would be like. If you would like to explore these ideas make sure to get in touch!


Rafael Herzberg's picture

Thank Rafael for the Post!

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Michael Alexander's picture
Michael Alexander on Aug 6, 2018 9:25 pm GMT

What kind of programs does Brazil use to control the dispatch of water resources? 

If Brazil were to diversify its energy resources, to include gas, solar, wind, etc.  would the economics in Brazil make these year round "competitors" to hydro, or would they be seasonal ones?

Rafael Herzberg's picture
Rafael Herzberg on Aug 8, 2018 8:57 am GMT

The independent system operator dispatches water resources as well as all other centralized power palnts in Brazil.

My suggestion is having power rates that fluctuat according to the marginal cost of operations so that end users (industrial, commercial, institutiuonal and residential energy users) would automatically choose what's best fopr them. It might be distributed generation like solar, having natural gas driven equipment (such as water heaters),  retrofittring the installation for energy efficiency or a combination. 

Right now the official entities only tell the market that "it will become better" generating unrealistic expectations. And of course most of the energy users have a natural tendency to accept this "diagnosis" as it is easier!

In the mean time our actual power costs are always climbing!

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