The Alternative Sources of Electricity Incentives Program (Proinfa) will make the diversification of Brazil’s energy matrix possible. On January 30th, the Mines and Energy Ministry submitted to public opinion the License Guide, which contains the requirements that need to be filled for the participation of private investor in the Proinfa. Proinfa, in a first phase, aims at Eletrobras’ engagement for a period of 20 years of 3,300 MW of energy generated by “renewable” sources, such as wind, garbage (biomass) and even water (small power plants).

The main objectives of Proinfa are the contribution for Brazil’s sustainable development, with numerous benefits for the environment and also the possibility of the diversification of the energy matrix, which highly depends on the hydrologic regime. The goal is that in 20 years the renewable energies serve approximately 10% of the country’s annual consumption of electricity, what, in the medium and long terms, may represent a prospective source for new private investments in the energy sector, since the projects which take part in Proinfa will have the warranty of engagement with Eletrobras for predetermined prices and periods.

During the first phase, due to the 3,300 MW limitation, Proinfa is only going to be able to absorb some projects, in which the main criterion will be the seniority of the environmental license of the participants. Certain other limitations, such as the engagement limit per state, generate controversies. The participation of agents already active in the electricity sector was also limited, except as to wind energy in the first phase of the engagement.

One of the novelties of the License Guide is that, in the second phase, the Ministry of Mines and Energy must define the sum of energy that must be engaged, taking into consideration that the price impact on the fee charged from the end consumer by the distributors can not exceed 0.5% of the fee in any given year. This limitation is not statutory and was introduced by the License Guide. With the submission of this Guide to the Public Inquisition, the receipt of comment and suggestions by the society is expected for this week, in order to improve the bill of the act that will regulate the engagement conditions for the first phase of Proinfa. In an environment of regulatory uncertainties created by the discussion of new model for the electricity sector in the National Congress, the perspective of regulamentation of Proinfa is great news.

Date of insertion:   11/02/2004 - 12:14:45