MP 998 (Provisional Measure 998/2020), approved by the Senate on Thursday night (4), does not impact the DG (distributed generation) segment in Brazil. This is what experts in the electricity sector say. Professionals and investors in the photovoltaic market woke up wondering whether the approval of this provisional measure affects the discussion on REN 482, the so-called “taxation of the Sun”. The answer is no.
The discussion on updating REN 482 is still ongoing at ANEEL (National Electric Energy Agency). In addition, there is a discussion about the creation of a legal framework for distributed generation being processed in the Brazilian Legislature through bills.
MP 998 was approved in the form of a conversion bill that came from the Chamber of Deputies (PLV 42/2020). If it were not voted on by February 9, the provisional measure would lose its validity. Now the text goes to President Jair Bolsonaro for sanction. According to Bernardo Marangon, an ACL (Free Contracting Environment – Free Market) specialist at Exata Energia, the approval of MP 998 should not affect DG.
“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 for this”, 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.
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.
“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.
When it was enacted in September 2020, this provisional measure ended government subsidies for the production of solar, wind and biomass energy. However, the text of PLV 42/2020 extends the subsidies for 12 months after the publication of the law. In addition, it allows incentives for the generation of energy from renewable sources in public buildings that use energy efficiency resources.
cove 3
The proposal approved by the Senate also allows for the creation of an additional tariff to cover costs related to the Angra 3 electricity sales contract. The text also determines that the granting of authorization for the operation of the nuclear plant is the exclusive responsibility of a state-owned company, and allows, in the event of privatization, for a new concession to be granted for extended contracts.
Angra 3 is being built on Itaorna beach, in Angra dos Reis (RJ). According to the federal government, 67,1% of the civil works for the plant have already been completed. Senator Jean Paul Prates stated that the provisional measure is a set of legislative amendments, a “patchwork quilt, with different topics that do not communicate with each other, a list of urgent problems, with a lot of disconnected things”. He also stated that “the increases have already occurred and resources are being taken away from science and technology; there has already been aid for the electricity sector, several companies have already been privatized”.
R&D Resources for CDE
If sanctioned by the president, MP 998 will transfer to the CDE (Energy Development Account), between 2021 and 2025, 30% of the resources that electric power concessionaires are required to apply in R&D (research and development) and energy efficiency programs. In addition, concessionaires and licensees of the public electric power distribution service will also be able to apply research and development resources in technologies for the storage of clean energy.
Currently, there is R$3,4 billion unused in R&D and energy efficiency projects, which could be directed to the CDE. Loans granted to distributors total approximately R$15,3 billion.
Answers of 2
Dr. Argolo, you are absolutely right, Brazil has not cared about R&D for a long time, researchers end up going outside Brazil to be able to work, so we will continue to be buyers of technology and also lose our research minds to other centers with greater firepower. I'm very interested in research, but it's difficult here.
Prof. José Luís Viana
It seems once again that in Brazil, research and development does not have the slightest value. Taking money from research and development is equivalent to a parent telling a child not to study and grow up. Wake up Brazil, no more foreigners doing research for Brazilians. The pandemic is showing who is capable of producing basic vaccine production inputs. Certainly removing money from research and development delays and shows that we are incapable of producing value-added goods from cutting-edge technology.
A sad decision.
prof carlos Argolo (Ph.D.) @ Boston University Massachusetts USA.