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Energy (Brazil): inflection point?

Energy (Brazil): inflection point?

In two months the short-term spot power prices climbed from R$ 54/MWh to R$ 340/MWh (1 USD = R$ 3,8).

It is a recurring phenomenon involving well-known conditions:

  • Undersized reservoirs of  hydroelectric dams (70% of the power matrix)
  • The expansion of the supply favoring intermittent sources 
  • The market's demand for electric power growing 
  • Lack of actual, solid demand response programs  

Brazil is a country blessed by the abundance of the cheapest sources on the planet for electric for power generation, but unfortunately the price paid by business, institutional and residential consumers is the highest among BRICS countries.

In a healthy environment high prices stimulate the expansion of the supply, generating in the sequence a reduction. It is not what happens in our country. The background of this scenario is the regulatory/institutional fragility of the electric sector, which carries an exacerbated risk rate.

Our "model" is a loser one. We need to turnaround this mess. Urgently!

Rafael Herzberg's picture

Thank Rafael for the Post!

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