Even Without Generating Power, Mining Company Vale Has Already Received Over R$ 500 Million for Submerged Power Plant in MG

Vale Mining Company Has Been Receiving Millions Since 2015 for Energy Generation From a Plant That Has Not Operated Since the Tragedy in MG

Vale Mining Company, which had a hydroelectric plant whose operations were halted after the Mariana tragedy (MG), continues to collect money for energy generation as if it were operational. In over 5 years, the company has received more than 500 million reais. By a decision of the Federal Court, the plant was kept in the “energy redistribution mechanism,” a distribution system in the electricity sector aimed at mitigating losses during droughts.

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Vale’s Plant

The Risoleta Neves hydroelectric plant belongs to the Candonga consortium, with Vale Mining Company holding 77.5% and Cemig 22.5%. The mining company’s hydroelectric plant ceased operations in November 2015, when one of the world’s largest environmental tragedies occurred.

The tragedy released thousands of tons of iron ore waste into the river known as “Rio Doce.” The sludge passed through 40 cities before reaching the Atlantic Ocean on the coast of Espírito Santo.

Cancellation of Payment to Vale

The case was taken to court and Aneel – National Electric Energy Agency tried to prevent the payment to Vale Mining Company. Since the tragedy, even though the plant did not produce energy, the company has received more than R$ 500 million, as if it were still operating today.

The total shutdown of the mining company’s hydroelectric plant led Aneel to naturally request the suspension of payments to the Risoleta Neves plant for its inability to generate further energy. However, Vale not only appealed against the agency’s administrative procedures but also appealed and obtained a decision that still maintains the payments to the Candonga consortium.

The agency shows that in fact, all plants pay monthly to the Risoleta Neves plant and gradually pass the cost onto energy consumers in Brazil in their electricity bills. Aneel data shows that this situation has resulted in direct losses of more than 100 million reais for consumers.

“Old” Case of the Mining Company

In October of last year, the President of the STJ, rapporteur and minister, Humberto Martins, rejected Aneel’s appeal, upheld the payment requested by Vale, and maintained the so-called Energy Reallocation Mechanism (MRE). This system was created to reduce the financial impact caused by the risk of drought in the country, allowing other plants with limited water available for electricity generation to be compensated by other plants in better conditions. Therefore, the situation is not about the Risoleta Neves hydroelectric relationship, which was engulfed by Samarco’s sludge.

Aneel has appealed Minister Humberto Martins’ decision, and the case will now be reviewed by the Special Court of the STJ, composed of the 15 oldest ministers. The first to vote is the rapporteur of the case, who will analyze the agency’s arguments against his previous decision. Following that, the other ministers will indicate whether they agree with the rapporteur’s vote. The agency, represented by the Attorney General’s Office, requested that the case be removed from the virtual agenda, where discussion is not necessary during the judgment. The fear is that a decision may be made without any discussion on the matter.