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Ministry of Mines and Energy proposes reform of the electric sector

Energy

Proposal that improves the regulatory framework was released on Thursday (6) and will be in public consultation for 30 days

In another measure of de-bureaucratization, the Ministry of Mines and Energy announced on Thursday (6) a proposal to reform the electric sector that seeks to reduce the judicializations and make the sector stronger and more efficient. The proposal, gathered in a 54-page document, will be in public consultation for 30 days and then sent to the National Congress.

According to the document, the electric sector is outdated, with socio-environmental and technological pressures that already affect the sector's regulatory and commercial model. Among the pillars of the reform is the application of clearer and more competitive rules in the energy market.

One of the main changes proposed is the current privatization model. Today, the state-owned hydroelectric plants tendered live in a regime of regulated tariffs, which ends up generating more expensive energy. With the change, these plants will be based on the market principles of supply and demand.

In addition, the reform proposes that the resources obtained from the competitions in the electricity sector be divided equally between the National Treasury and the consumer, which, in practice, will result in a larger collection of public coffers. This could lead to a 7% increase in energy tariffs, but would be offset by the reduction of charges and subsidies currently paid by the taxpayer.

However, initially, until 2019, the proposal provides an incentive for federated entities that want to sell their assets. In the model proposed by the MME, the amount collected with the auction would be divided equally between National Treasury and the controller of the enterprise.

Source: Portal Brasil, with information from the Ministry of Mines and Energy