Eletrobras MP Will Result in a Loss of R$ 400 Billion. According to Fiesp, About R$ 300 Billion Would Come from Increases in Electricity Bills Over the Next 30 Years

Fiesp decided to take a stance regarding the text of the Eletrobras privatization vote, which was discussed in the Senate last Wednesday (16). According to the entity, the cost of capitalizing the state-owned company could increase electricity prices and cause billion-dollar losses to Brazilian consumers.

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Privatization Will Result in Higher Electricity Bills, Says Fiesp

Fiesp estimates R$ 400 billion in losses for Brazilians, with about R$ 300 billion arising from increases in electricity bills. “It’s a monopolistic market. Brazilians cannot switch companies in search of a better offer,” says the entity.

According to the entity, the proposal to contract inflexible thermoelectric plants, which generate energy continuously, could raise tariff costs by R$ 50 billion over a period of 20 years.

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In light of the industry’s and energy sectors’ criticism of the MP text, the federation argues that there will be additional expenses of R$ 30 billion over two decades due to market reserve for small hydropower plants.

The Fiesp also adds R$ 20 billion in its calculations over this period, referring to the renewal of “old and expensive” contracts of generators through Proinfa (Program for Incentive to Alternative Electric Energy Sources).

Understand Better the Privatization of Eletrobras

The proposal, which was submitted to the National Congress by the Government, suggests that Eletrobras sell new common shares on the Stock Exchange and also provides that the Union has the right to a special share, known as a golden share.

The Eletrobras privatization MP also establishes that the company will spend about R$ 3.5 billion over ten years to revitalize the São Francisco River basin and more than half a million aimed at reducing energy generation costs in the Amazon and in the reservoirs of the Furnas plant.

About the State-Owned Company

With more than 90% of its capacity installed in renewable and low CO2 emission sources, Eletrobras is a leader in electricity transmission and generation and is reflected in the electricity bills of various consumers, contributing to making it more accessible and cheaper, and also helps ensure that Brazil’s energy matrix is one of the most renewable and clean globally.

The company also operates in energy efficiency and commercialization sectors, in addition to programs like the Light for All Program, Procel, and Proinfa. Additionally, the company has planned investments between 2018 and 2022 of around R$ 19.756 billion.

Solar Energy Could Become the New Option for Consumers After Eletrobras Privatization

In recent years, solar energy has been adopted at surprising levels and is increasingly gaining prominence, and now that there is a possible Eletrobras privatization, consumers’ electricity bills have a significant chance of rising even more, thus making solar energy the new option for consumers.

Consumers have already faced some issues with privatization, such as during Fernando Henrique’s government when a privatization process began and resulted in some blackouts.

However, this time could be different, as consumers now have other options with the arrival of new energy sources, such as solar energy. With the installation of photovoltaic equipment on rooftops for distributed generation, consumers can save approximately R$ 2,700 per year.