The Amazonas Energia case causes several surprises – 01/10/2024 – Gerson Kelman

The Amazonas Energia (AE) concession area is the national champion in the rate of non-technical energy losses (a euphemism for theft). With declining revenues, AE has become unsustainable, including failing to pay for the power it buys from Eletrobras thermal plants.

The government had to make choices. One possibility is to interfere in the franchisor’s affairs or declare the franchise forfeited. It would stand to reason that AE’s current difficulties are due solely to poor management. This does not appear to be the case.

Another possibility is to help the franchisor, at least temporarily. Ideally, this aid should be reflected as an expense in the union budget, but given the country’s financial situation, the cost of aid will realistically materialize, making the electricity bill for all Brazilians more expensive.

Should I provide assistance for an existing or new AE controller? In fact, the correct choice was the second option. Who should be the new monitor and how much assistance will there be? The sensible thing to do would have been to hold a competition between potential console candidates, choosing the one that provided continuity of service to Amazon residents and minimal cost to consumers across the country. Instead, the government appears to have chosen Amber.

“Apparently” because, in a first step, Ampar bought the “Micadas” thermal stations from Eltrobras. Few understood. For Eletrobras, it looked like an excellent deal to get rid of power units whose only customer, AE, was in default. But as for Amber… why did he make such a bad deal? The answer came shortly after the deal, through the issuance of Interim Measure No. 1232/2024, which transformed the “mini” contracts between thermal plants and the renewable energy company into backup energy contracts, with a guarantee of compliance. The official explanation for this sequence of events: mere coincidence. If so, Amber is very lucky!

The interim measure also specified that Aneel would study and approve the share control transfer plan prepared by the AE-Âmbar duo if it is proven that its implementation will lead to the restoration of the economic and financial sustainability of the concessionaire, with the least possible tariff impact. Anel’s technical department studied and rejected the plan, because it would increase the electricity bills of all Brazilians by R$16 billion. What is needed, according to technicians Anil, will be only half of this amount.

AE went to court and obtained an injunction issued by a first instance judge of the Federal Court of Amazonas, giving Aneel’s board of directors 48 hours to “immediately approve the plan to transfer control of the company in the form presented by… …”. That’s right: the injunction does not specify that Aneel decides the plan, but rather accepts it as proposed, in an implicit manifestation of disdain for the technical knowledge of Aneel’s employees. astonishment!

Anil’s board met shortly before the injunction expired, but were unable to reach a decision. There was a tie between two positions. The government remains without appointing the fifth director, who would have violated this decision and others. astonishment!

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