Alexandre Silveira’s tantrums and threats will not improve the electricity sector

I live in São Paulo and I know very well that Enel-SP has been providing a poor service to the city’s electricity consumers. The region where I live is not one of the most affected by blackouts, but I know a lot of people who consider themselves more victims than customers of the company. She has to be charged hard for improvements in the service.

Still, I can’t sympathize with the way the Minister of Mines and Energy Alexandre Silveira (PSD-MG) got into the matter this week.

Silveira did something that is within his remit: he asked the National Electric Energy Agency (Aneel), which supervises and regulates the sector, to open disciplinary proceedings against Enel-SP.

But he advanced the signal by stating, on Monday, 1, that the distributor “you will have little chance of defending yourself in this process”, taking into account its performance history. Silveira even said that the process could result in the early interruption of the company’s concession contract, which expires in June 2028.

Undue interference

It is not up to the minister to anticipate Aneel’s conclusions. On the contrary, he should ensure that the agency can carry out its technical work autonomously.

But Silveira, although he belongs to the PSD, the party without any character (“it is neither right, nor left, nor center”) created by Gilberto Kassab, has the authoritarian-interventionist tic of the Lulist left. So much so that he is very comfortable in the current government.

The minister burst into the debate for purely political reasons. He was irritated when the mayor of São Paulo Ricardo Nunes recalled that electricity concessions are made by the Union, which is responsible for demanding excellence from the distributors.

Silveira received a receipt this Tuesday, 2nd, when contacting Ricardo Boulos, the Psol and PT candidate for mayor of São Paulo, to talk about Enel-SP. Nunes told the press that he was not approached for a similar conversation and added a clever sentence: “the minister is only quick to make politics”.

In time: Nunes is not free from blame in this story, because many interruptions in the electricity supply in São Paulo are caused by falling trees, the municipality’s responsibility to prune them.

Ranking

But let’s go back to the minister. Silveira decided to give shock treatment (pardon the stupid pun) to Enel-SP, as if it were the only company with poorly rated services in Brazil. It is not.

In mid-March, Aneel released the performance ranking of the 29 distributors that serve more than 400 thousand consumers in Brazil. In terms of “continuity of supply”, Enel-SP is in twenty-first position (tied with Enel-RJ and Equatorial, from Maranhão).

Another six distributors have worse service levels, including Cemig, from Minas Gerais, Silveira’s political base. The state Legislative Assembly met in December last year to charge the company. She seems more concerned about the matter than the minister.

Lack of guidelines

Like Enel-SP, another 19 distributors have concession contracts expiring between 2025 and 2031. The matter is serious. It is a historic opportunity to review the model and improve the sector’s rules, which began to be designed 30 years ago.

In his interviews this week, ranting about Enel-SP, Alexandre Silveira said that the concession rules are “loose”. He did not go into further detail. But it is precisely the guidelines for renewing concessions that the market has been waiting to receive from the government for more than a year. EDP ​​Espírito Santo, whose contract expires in July 2025, should have received these guidelines in January. Still waiting.

The Brazilian energy sector needs good rules and legal certainty to improve. No tantrums, threats and undue interference from Alexandre Silveira in Aneel’s decisions, which must be independent.