Blackout risk: market hysteria, or government's pink lenses?

OPINION

In this issue, we seek to clarify, as quantitatively and factually as possible, a number of questions raised by the press and by agents regarding the electrical power system supply security. For this, we analyze several indicators: (i) risk of an energy rationing being enacted ; (ii) operation marginal cost greater than the economic cost of cutting supply; and (iii) blackouts caused by faults in the transmission network and by recent problems of generation spinning reserve.

REGULATIONS

This section addresses the following topics: (i) penalties for plants behind schedule; (ii) amendment of penalty clauses in CCEARs; (iii) certification of CCEE computational programs – and what it shows about the rules; (iv) postponement of changes in ACL contracting; (v) provisional CDE; (vi) guidelines for the A-3 auction of 2014; and (vii) the current crisis, in past editions of ER.

JURIDICAL

This section makes an historical and legal analysis of situations that resulted in claims for economic and financial rebalancing of contracts for electric energy trading.

ENVIRONMENTAL

The topics of this section are: (i) environmental impacts deriving from the operation of PCHs; (ii) (another) mistaken analysis of emissions from the electricity sector; and (iii) the bidding for Três Irmãos power plant.

SUPPLY

This section presents an updated overview of electric energy supply in Brazil, through structural balances of energy (with and without friction factors) and of peak, developed by PSR.