Senator Eduardo Braga, former Minister of Mines and Energy, stated this Wednesday (29), during the second day of discussion of the preliminary report of Provisional Measure 1.304/25, that the planning failures of the electricity sector led to the current energy imbalance in the country, with daily cuts in renewable energies that have caused losses of billions for Brazilian generators and consumers.
He recalled that several generators built their projects with access permits to the transmission system "with a restriction note," therefore, knowing the risk they were taking from an energy standpoint.
"The investor took the initiative, at their own risk, to make the investment, and now it is not fair that this money be taken from the Brazilian consumer to compensate for an investment made under these conditions," he said.
"Those that were made according to the connection point, the flow of cargo, those are being compensated," he stated, referring to the regulations included in the Provisional Measure's report.
According to the Provisional Measure, wind and photovoltaic generators will be entitled, through a commitment agreement with the Granting Authority, to reimbursement of curtailment Regarding external unavailability and compliance with reliability requirements, from September 1, 2023, until the entry into force of the law converting the measure. To this end, agents will have to withdraw any ongoing legal action.
However, the provisional measure does not provide for reimbursement for energy-related reasons – that is, when there is a lack of demand to absorb the energy supply. This cost, according to the senator, should be attributed as a business risk.
Braga pointed out that Brazil receives 33% of its energy dispatch from renewable sources"It's not just distributed generation that has caused problems, it's also the centralized system, because there's a limit to any business, which is the consumer market," he stated.
He criticized the fact that the country has been building run-of-river hydroelectric dams for two decades, without the storage capacity that the system needs.
“I courageously wrote in my report that Brazil needs to return to building hydroelectric dams with reservoirs because we have lost our water capacity. We put in place a directive so that the government, through a special environmental license, can, within a period of up to 90 days, indicate the environmental licenses for possible new reservoirs with water capacity,” he declared.
According to him, there are several quarries that have exhausted their mining production capacity and that can be used as reservoirs for the construction of reversible hydroelectric plants, thus "providing an additional water reserve."
"This solution has been put forward and, at the same time, we are signaling with chemical storage and water storage the guarantee of having energy storage to correct the energy imbalance that is currently in the system," he said.
“I believe that, with this explanation, I tried to clarify to the members of parliament and senators, and to the public that is following this, that Brazilian energy planning has failed. We, regrettably, have failed. We lost control of the low-voltage distributed generation and we lost control of the high-voltage centralized renewable generation, and this has created a serious problem of electrical, energy, and flexibility imbalance in the system,” stated Braga.
Braga's final report will still be voted on in the joint committee before going to a vote in the Chamber of Deputies and, subsequently, in the Federal Senate. MP 1.304 It expires on November 7th.
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