|
12 November 2003 - Eleven months after Brazil's President Luiz Inacio Lula da Silva took office as Brazil's President and more than a year since his team started working on a new power sector model, sector executives are still in the dark about what changes the new model will bring and how companies will be affected, writes Business News Americas.
Speaking at the POWER-GEN Latin America conference in Sao Paulo on Tuesday, Xisto Viera Filho, VP of regulatory issues and planning at US energy company El Paso, emphasized the need for the new model to guarantee investments in gas-fired thermoelectric plants.
The two big issues to stimulating investments in thermoelectric plants are the price of natural gas and the methodology for calculating transmission rates, said Viera, who is also head of thermoelectric generators' association Abraget.
"Abraget believes that hydro power is fundamental for the country, but the cost of new hydro plants is increasing while the price of gas in the medium term tends to fall," he told Business News Americas.
Building a new thermoelectric plant near large consumption areas has a similar cost to constructing a new hydro plant in the Amazon, once the cost of transporting power from the Amazon to southeast Brazil is included, he said.
"The Piratininga thermo plant pays 20 per cent more in transmission costs, despite being in the middle of Sao Paulo, than other generators located far from sources of consumption," said Viera, who emphasized the need for recalculating transmission rate methodology.
Brazil's distributors are also concerned about the model. Paulo Cezar Coelho Tavares, VP of energy management at local group CPFL, said the distributors' concern is the transfer of risk to distributors. "We have to know how much demand will be over the next five years," he said.
Other concerns are distributors being burdened with non-paying customers and the transition from the present model to the future model, he said.
Another issue that needs to be resolved is "non-neutrality," said Marcelo Llevenes, Brazil country manager for Spanish energy group Endesa. "The problem is that distributors are paying a greater rate to generators and are unable to pass it on to the final consumer," Llevenes said.
| 
Articles 
| View all PennWell sites | View all PennWell events
Add RSS Feed
