The federal government determined on Tuesday (31) the creation of a new tariff flag to bear the high costs of power generation in the midst of the water crisis. The announcement was made by Ministry of Mines and Energy after an extraordinary meeting of the Chamber of Exceptional Rules for Hydroenergy Management (CREG).
In the schedule, the National Electric Energy Agency (Aneel) he pointed out that the collection already carried out through the banner’s additional charges, at the current red level 2, is insufficient to face the actual costs observed and foreseen to cover the coming months – which will still be dry. “Given the existing collection deficit, exceeding R$ 5 billion, and the high costs verified, notably of thermoelectric generation, a determination was approved for the regulatory agency to implement the specific level of the Tariff Flag, entitled “Hydric Scarcity” ”, informed the MME. The value will be BRL 14.20 per kWh, effective from September 1, 2021 to April 30, 2022.
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According to the ministry, the “Hydric Scarcity” banner will cause an increase of 6.78% in the average tariff of regulated consumers, those who are connected to energy distributors, in the case of residential ones.
The rate applied until this August 31st was BRL 9.49 per 100 kilowatt-hours consumed, readjusted two months ago, with an increase of 52%. After that change, there was already an expectation for the new high, to be promoted after a review of the calculation parameters. According to Aneel, it would be necessary because that readjustment effective from July would not accommodate the price of generation during the second half of the year – the risk was indicated by Aneel’s technical area, which signaled the need for a total readjustment between 84.3% and 92 .3% in red flag 2 to account for the increase in the offer.
Flag readjustment to pay for the crisis
Energy generation costs had a considerable advance from the dispatch of thermal plants, widely used in an attempt to circumvent the water crisis and avoid the depletion of hydroelectric reservoirs, which are at worrying levels due to historical shortages. In the twelve-month period ended in July, the average energy tariff in the country rose 20%. The July increase has already had strong effects on inflation, along with other factors such as high commodity prices and breaks in production chains.
Last week, Economy Minister Paulo Guedes stated that there would be a new readjustment. The declaration came along with a period of change of tone for the federal government in the face of the water crisis, with a series of announcements related to energy savings – voluntary for the industry and for small consumers and compulsory in the public service.
So far, the Ministry of Mines and Energy has ruled out a scenario of shortage risks, but a recent note from the National Electric System Operator (ONS) warns of the risk of blackout if the country does not increase its energy supply by 8% among the September and November (when the wet season starts and when the rains are expected to resume).
Confirmed bonus for reducing household consumption
Along with the announcement of the so-called Water Scarcity tariff flag, the Ministry of Mines and Energy confirmed the proposed rules for the Incentive Program for the Voluntary Reduction of electricity consumption, applicable to small consumers, such as residential ones. They will be effective from September, with a bonus of R$ 50 per 100 kWh reduced, limited to the savings range between 10% and 20%. Low-income consumers who adhere to the social tariff will also be able to participate according to the MME.
The resources to pay the “award” to engaged consumers will come from the System Service Charges (ESS), which are already charged on the monthly bill. According to the MME, the bonus should cost around R$339 million per month, R$1.3 billion over a four-month period.
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