It is urgent that President Luiz Inacio Lula da Silva correct Congress’s glaring mistake by approving Interim Measure 1304: extending incentives for coal-fired thermal power plants until 2040. There is no technical, economic, social, or environmental justification for maintaining the subsidies. Coal does not meet the needs of the Brazilian electrical system, it is expensive, will increase the consumer’s bill, and is the generation source that emits the most greenhouse gases. It is disturbing that parliamentarians have turned a blind eye to all this evidence. If he does not use his powers to veto this disaster, it will be a disaster.
In Brazil there is no shortage of energy. In the past ten years, the installed electricity generation capacity has increased from 95.5 GW to 236 GW. The increase was almost entirely (97%) due to renewable sources, especially wind and solar energy. In 2015, Brazil actually stood out in the share of renewables in electricity generation, at 74%. Today this percentage is 88%. In the United States, 21%, in China, 24%, and in Europe, 38%. In the energy transition race to reduce gas emissions, Brazil is an example to the world. There is no reason to distort this path by subsidizing coal.
- Miriam Leitao: Coal subsidies could cost Brazilians up to R$107 billion by 2040
Progress in alternative sources has not been without problems. The sector is also an ardent supporter of consumer-paid benefits. Wind and solar power have put pressure on security and confidence in the system. Since this electricity is intermittent, as it relies on the sun and wind, it is necessary to respond quickly to outages or excess generation. Recognizing this fact, coal lobbyists convinced Congress that thermal power plants, along with hydroelectric and gas-fired thermal plants, were part of the answer. I forgot that coal plants need nine to 12 hours to start pumping power into the grid. When they are ready, the sun will be close to rising. It’s expensive not only for the environment, but for the consumer’s pockets as well.
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Coal subsidies totaled about R$11.5 billion from 2013 to 2024, according to calculations by the Arrayara International Institute revealed in journalist Miriam Leitão’s blog on the GLOBO website. With maintenance until 2040, the total will range between R$76 billion and R$107.7 billion. The lower value corresponds to a partial operation scenario, and the higher value corresponds to a full operation. The cost of liabilities and environmental pollution are not included in this calculation. “We estimate that for Santa Catarina alone this cost will amount to R$20 billion. For Rio Grande do Sul, our forecast is another R$5 billion,” says John Wordig, director of energy transformation at Arayara. The Brazilian Sustainable Carbon Association questions these calculations, but does not provide a satisfactory estimate. The whole world urgently needs to stop generating coal power. Lula should veto the stimulus extension without fear of making mistakes.
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