Will there be blackout? October must be the decisive month; understand

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One of the government’s biggest bets to circumvent the water crisis and remove the risk of rationing energy it is the activation of four thermal power plants, which, together, are capable of producing 1,300 MW. “The thermoelectric plants are ready to be activated, there is only one problem”, says Xisto Vieira, CEO of the Brazilian Association of Thermoelectric Generators (Abraget). “Natural gas is needed to feed them and the input is not yet available in sufficient volume, although there are several government negotiations to increase supplies.”

One of the alternatives is to increase imports from Bolivia, one of the world’s largest producers of natural gas. Negotiations, however, have not advanced. Petrobras, responsible for intermediation with Bolivian state-owned Yacimientos Petrolíferos Fiscales (YPFB), is trying to sign a new contract with import volumes in excess of the current 20 million cubic meters per day – the goal is to reach 30 million. “So far, the negotiations have not been successful,” Petrobras informed EXAME through a note. “As already disclosed, Petrobras is working with YPFB in the search for a new interruptible contract for a temporary increase in imports from Bolivia.”

The high global demand for natural gas, with the economic recovery, and the exponential growth in the product’s price, which increased 1,000% in Europe since last year, is pointed out by market sources as one of the barriers to signing new contractual clauses. Another, equally important, is the very limitation of YPFB’s generating park. “The company has been suffering from structural issues that have not allowed production to resume at the levels of a few years ago,” says Rivaldo Moreira Neto, president of the Gas Energy consultancy.

The four thermal plants listed by the government to start operating in October, Cuiabá, Uruguaiana, Termonorte 1 and Termonorte 2, await the arrival of the input. Together, they have the capacity to produce 1,300 MW. With the water crisis, the country will need to generate something close to 5,000 MW so that there is no energy shortage, according to the National Electric System Operator (ONS).

“At the moment, it seems a little difficult to close this account, given the system’s own restrictions and the difficulty in obtaining a significant volume of natural gas to feed the plants”, says economist Adriano Pires, founding partner of the consulting firm Centro Brasileiro de Infraestrutura ( CBIE).