Aneel director says that without a new law, energy bills will continue to increase in less developed states – News of Brazil

The electricity tariff in less developed states will continue to increase if the National Congress does not change the current laws on the subject. The statement was made by the general director of the National Electric Energy Agency (Aneel), Sandoval Feitosa, in a public hearing held this Thursday (5) at the Infrastructure Commission (CI). The invitation met the senators’ requests Lucas Barreto (PSD-AP), Jader Barbalho (MDB-PA), Randolfe Rodrigues (AP-Network) and Amin Esperidião (PP-SC), who chaired the meeting.

According to Feitosa, Law 13,360, of 2016, stipulates that until 2030, electricity users will also be charged for contributions to the Energy Development Account (CDE), which makes up part of the energy tariff. The CDE is a fund that finances public policies, such as the social tariff for low-income people. For Feitosa, this and other laws lead poorer states to pay a higher tariff, and the agency has no power to reduce the values.

“There was an option by the Brazilian State to take electricity to a continental country. There is a cost to important public policies. This needs to be paid for. Congress itself decided in 2016 to equalize the payment of these charges for all of Brazil. This decision was not made by the agency (…) Aneel has an infralegal role, we work in the implementation of public policies and guidelines for contracting auctions [de concessão] which are defined by both the Legislative Power, the Executive Power and the granting power. The formation of energy tariffs in Brazil needs legislative adjustments to be fair”said Feitosa.

Increase until 2030

Feitosa stated that the bill will increase in the coming years until the CDE apportionment is equal, according to the law. According to him, currently taxpayers in the South, Southeast and Central-West Regions still pay more than twice as much to the CDE than the North and Northeast. For Feitosa, one of the solutions to reduce tariffs is to make the CDE contribution proportional to regional development.

“What we first present is a proposal that the CDE takes into account the population’s ability to pay. Regions that have less payment capacity would pay fewer sectoral charges. And regions that have more capacity would pay more. This has the potential to reduce the tariff by 5% to 8%, it’s a lot.”

The senator Jader Barbalho stated that the current tariff policy affects the poorest and that Congress must act.

“I was scared. The cost of energy directly affects Brazilian families, especially the poorest. We have to deepen measures [contra o aumento]”.

Feitosa explained that the electricity tariff is made up of four parts, related to its generation, transmission, distribution and social charges. He highlighted that sectoral charges such as the CDE, which are collected to finance public policies, represent the majority of the bill. The director demonstrated that this item grew twice as much as inflation (IPCA) in the last 13 years. The distribution portion increased below inflation, while generation and transmission costs followed the main inflationary indices.

Adjustment in Amapá

In recent weeks, Aneel authorized a 44.41% adjustment to the energy bill in Amapá, which led Randolfe Rodrigues and Lucas Barreto to request Feitosa’s presence at the public hearing to provide explanations. According to the general director of Aneel, the increase was requested by the privatized distributor CEA Equatorial Energia based on the concession contract. Once the requirements are met by the company, Aneel is obliged to authorize it, he said.

“The state had a very depressing quality of service, it did not have investment capacity and there was this decision [de privatizar a empresa de energia]. The concession contract included the possibility of an extraordinary tariff review. It is up to Aneel to simply verify that everything invested was actually done. If it was done, Aneel is bound, it has nothing to do except calculate the remuneration and apply the adjustment (…) It is expensive to distribute [energia] in the North Region due to several factors. Firstly, it has low demographic density and low per capita consumption. So this cost has to be shared with consumers who pay the bill to cover the investments that are made”.

Lucas Barreto pointed out the low income of the population and the high rate of debtors as aggravating the impact that the increase will have on the state.

“In Amapá we have almost 130 thousand people who receive family grants. The tariff policy must be reviewed before granting this increase. Chaos will ensue in the Equatorial CEA, in the state of Amapá and in the state government”.

Randolfe questioned why Feitosa’s arguments were applied to Amapá but not to other states.

“Roraima has a lower demographic density than ours. On the energy tariff scale, Roraima is 14th or 15th. In the event of adjustment [no Amapá], we will go big. This should be a warning. We have two months either for this adjustment not to be applied or for it not to be under the terms approved by Aneel”.

Randolfe It is David Alcolumbre (União-AP) met on September 21st with the governor of Amapá, Clécio Luís, and the Minister of Mines and Energy, Alexandre Silveira, to handle the case.

Suggestions

In addition to the change in the CDE, Feitosa presented other changes that could reduce the price of energy. According to him, the Legislative Decree Project (PDL) 365/2022, which suspends two Aneel resolutions on energy transmission tariffs, will cause an increase in the cost of electricity. This is because, according to him, the “locational tariffs” methodology currently used by the regulatory body will no longer be used, harming 18 states that currently benefit from cheaper transmission.

“She [a metodologia] reduced the tariff in 18 states across the country, most of them in the Northeast and North. Rio Grande do Norte, which is the largest producer of wind energy in Brazil, reduced its transmission tariff by 40% (…). The rejection of the PDL has the potential to reduce the transmission tariff to the final consumer by 1% to 4% by 2027.”

Approved by the Chamber of Deputies, the project is being analyzed by the CI. For Amin, the “PDL is the subject of a controversy”. The author of the project, deputy Danilo Forte (União-CE), understands that Aneel’s resolutions have an opposite effect, leading to an increase in energy transmission costs in locations far from large consumption centers.

Feitosa also defended that Aneel has the power to reduce the remuneration rate to be received by the energy distributor when it benefits from lower taxes.

For him, less developed regions favor companies with tax reductions, so that the distributor could reduce the final value of electricity charged to citizens without having a proportionally lower profit compared to other regions. But Normative Resolution 457, of 2011, which allowed this practice by the agency, has been suspended by court decision.

According to him, all his suggestions need to be created by law and could reduce tariffs in the country by 7.5% to 14.5%.

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