Government will give bonuses to those who reduce energy consumption at home from September, says minister – Economy

BRASILIA – The Minister of Mines and Energy, Bento Albuquerque, stated that the voluntary reduction program aimed at residential consumers will start from September 1st. The government will give discounts on electricity bills to residential consumers who save electricity, as anticipated the Estadão/Broadcast. The expectation, according to the Ministry of Mines and Energy (MME), is to disclose the rules of the measure at the beginning of next week.

“The program is being structured and will have a definition of a minimum reduction target for granting credit”, informed the ministry in a note distributed to the press. “We are evaluating the metric for all consumers. The idea of ​​the program is to reward those consumers who make an effort to reduce the load and thus contribute to increasing the safety, reliability and cost of generation”, said the secretary of energy Electric Ministry, Christiano Vieira, without detailing how this “award” will be given to consumers.

He stated that there was a well-characterized shortage in the reservoirs located in the Southeast, considered the water tank of the electrical system, but that the prospects for rainfall in the southern region are not materializing. During a press conference, he cited approval to increase the transfer of energy from the Northeast to the Southeast and South, to take advantage of the generation of wind farms.

To guarantee the supply of electric energy, the government has authorized the activation of thermoelectric plants, even the most expensive ones. According to the secretary, today there are plants in use that cost over R$ 2 thousand per megawatt-hour (MWh).

The government hopes, according to him, that the voluntary consumption reduction program aimed at large consumers (such as industry), and other initiatives, are more “economical” options. “With voluntary savings, we may not put into operation plants with a cost above R$ 2 thousand/MWh,” he stated.

Despite the financial incentive to save energy, the measures adopted to avoid rationing and blackouts will cost consumers dearly. As the Estadão/Broadcast, Internal calculations point to the need for the level 2 red flag, currently at R$ 9.49 per 100 kilowatt-hours (kWh), to be raised to something between R$ 15 and R$ 20. There is still a limit scenario of up to R$25, but it is unlikely that it will be adopted. The flag for September will be announced on Friday the 27th. Red flag 2 has been in effect since June.

The government also decreed the compulsory reduction of electricity consumption in the federal public administration. Agencies and entities should reduce electricity consumption by 10% to 20% from September 1st to April 2022. Agencies should provide justifications in cases where they fail to reach the reduction target.

In a press conference this Wednesday, the minister stated that “everyone knows that the cost of energy generation has increased in the face of thermoelectric generation”, but he ruled out rationing. “This has to be very clear,” he said.

Measures

The bonus for residential consumers is part of a series of actions that the government is seeking to try to avoid blackouts during peak hours, when there is more demand for energy. On Monday, 23, the MME published the rules for a similar program of voluntary reduction in energy consumption, but aimed at large consumers, such as industries. In return, companies will receive financial compensation.

To enable greater adherence to the program, the government accepted requests from sector agents and reduced the minimum amount of savings that companies must offer from 30 average megawatts (MWm) to 5 MWm. The proposals must be submitted to the ONS and will be analyzed by the Electric Sector Monitoring Committee (CMSE). The measure will be valid until April 30, 2022.

no rain

Bento Albuquerque stated that the prospects for rain until the end of this year’s dry season, mid-September and October, “are not good at the moment”. In a press conference on the afternoon of Wednesday, 25th, he stated that the months of July and August registered the worst amount of water that reached the reservoirs in the historical series.

“The prospects for the future we have so far, in terms of precipitation until the end of the dry period, are not good. It remains with the prospect of lower rainfall until the end of the dry period, until the end of September, October”, he stated.

The minister stated that the government monitors the electricity sector 24 hours a day and that this week extraordinary important meetings were held by the CMSE and the Chamber of Exceptional Rules for Hydroenergy Management (CREG).

“We identified that the months of July and August were the worst months in the historical series of monitoring of our electricity sector. Particularly, the reservoirs in the South region, which correspond to 10% of our storage capacity and the reservoirs of the National Interconnected System as a whole. This obviously has consequences for the hydro-energy management of our system”, he said.

The country faces the worst water crisis in the last 91 years, with serious shortages in the reservoirs of the main hydroelectric plants. On Tuesday, 24, the Ministry of Mines and Energy (MME) admitted, in a note, a “relevant worsening” in the country’s water scenario and in projections for the coming months. The government announced new measures to restrict the use of water and said that it was “essential” to adopt all ongoing actions and proposals to guarantee energy supply.