MP 998 (Provisional Measure 998/2020) which changes the rules of the electricity sector has been a topic of discussion in the Chamber of Deputies since Wednesday (16). The debate, which has been followed by several professionals in the solar sector, raises a question: can DG (distributed generation) be affected?
Lawyer Bárbara Rubim, vice president of Distributed Generation, ABSOLAR (Brazilian Association of Photovoltaic Solar Energy) and an expert in the segment, says no. “The basic text of MP 998, which was voted on yesterday [Wednesday] in the Chamber of Deputies, does not directly impact distributed generation because it does not include any exposition on DG. There is an amendment that is pending a vote and, obviously, the text can be changed in the Senate, which I understand to be unlikely”, explains the lawyer.
Bernardo Marangon, specialist in ACL (Free Contracting Environment – Free Market) at Exata Energia, highlights that MP 998 aims to reduce costs for consumers and should not affect GD. “MP 998 was created with the aim of reducing tariffs for end consumers, mainly due to the impacts that will be felt due to the pandemic, using R&D (Research and Development) resources and removing the 50% incentive for renewable energy. , and in the text by rapporteur Léo Moraes the incentive remains for PCHs (Small Hydroelectric Power Plants)”, he explains.
“Another concern was to reduce the increase in tariffs for distributors in the north of the country, which were managed by Eletrobrás and are currently owned by the private sector. In this case, other consumers will have to bear this cost. In short, for DG, which grows in times of high energy costs, this increase should be a little lower than predicted without the MP”, he concludes.
According to Josiane Palomino, director of Generator Management and Distributed Generation at Comerc Energia, a company specialized in energy management, the base text of MP 998 does not deal with DG. Furthermore, the expert states that due to the proximity to the year-end recess, the expectation is that the text will go to the Senate as it is, eventually complemented by highlights.
“GD projects, for now, will continue to be supported by REN 482. We will, indeed, have a change with regard to centralized generation, with a change in the deadline for requesting new grants with the right to a discount on TUSD-TUST (12 months from the publication of the law and no longer from 1/9/20), which expands the window for requesting centralized generation grant requests with the right to discounts in the current rule and, consequently, offers more breathing room for the market of centralized generation”, explains the specialist.
“In addition to distributed and centralized generation, MP 998 addresses other fundamental issues for the modernization of the energy market in Brazil, such as encouraging renewable sources. It is a broad discussion, which we are following closely and which should only be concluded at the beginning of the year”, adds Josiane.
Mobilization of the sector
Since the beginning of the discussion of MP 998 in Wednesday's session, members of the MSL (Associação Movimento Solar Livre, made up of energy consumers and businesspeople who generate jobs in all municipalities in Brazil, mobilized on social media.
According to one of the founders and president of the MSL association, Hewerton Martins, this action was in favor of clean energy. “There were amendments that could be very harmful to distributed solar energy. The move we made was to raise awareness and prepare the deputies' speech for the clash of distributed generation, there were amendments in MP 998 that would be harmful or even end distributed generation and this was discarded”, he highlights.
“The deputies spoke about clean wind and solar energy that deserve full incentives, avoiding going against the grain of the world by exchanging the sun and wind for polluting thermoelectric plants, distributed generation was also present in the speeches showing that the majority are already aware of the importance of this generation in roofs of houses in all municipalities in Brazil. We are talking about renewable energy, whether centralized or distributed, we are talking about clean energy. We focus on distributed generation because it generates distributed jobs and drives the economy of the municipalities, but we have clean energy as our flagship at the heart of the association, whatever it may be”, highlights Martins.
Power generation in public buildings
In the text presented by the rapporteur of MP 998, deputy Léo Moraes, the parliamentarian accepted an amendment that allows concessionaires and licensees of the public electricity distribution service to apply research and development resources in technologies to install solar, wind and biomass energy systems and storage in buildings used by public administration.
For Martins, it is a wrong measure. “There is a part that creates subsidies, increases the cost of the CDE subsidy (energy development account) paid by all consumers, from the poorest to the richest, for distributors to implement solar photovoltaic plants distributed on the roofs of public buildings for free. It makes no sense for the Brazilian people to pay for the installation in public buildings. This should be an investment policy for public bodies and not an agreement with energy distributors generating revenue for them and paid for by the consumer. This makes no sense”, says the executive.
Still according to Martins, the debate on MP 998 occurs at a time when the country should focus on solutions that affect the pockets of Brazilian consumers. “We are paying red flag level 2, the water regime is the lowest in Brazil's history and we are at risk of a blackout next year. This is because energy consumption has increased a lot due to working from home and in the summer we will have the air conditioning on”, he highlights.
The executive also adds that in addition to the risk of a blackout, energy rationing, tariff increases, a water crisis and the activation of thermoelectric plants could occur in 2021. If this occurs, those most affected will be consumers.
“Food will become more expensive because energy will be more expensive and the solar source taxed at 28% loses the opportunity to produce cheaper food, as producers use electricity in irrigation for food production”, he emphasizes. MP 998 was approved by the Chamber of Deputies this Thursday morning. Now, the proposal goes to the Federal Senate for analysis.
