{"id":94150,"date":"2025-05-13T11:04:47","date_gmt":"2025-05-13T14:04:47","guid":{"rendered":"https:\/\/murray.adv.br\/?p=94150"},"modified":"2025-05-13T11:04:47","modified_gmt":"2025-05-13T14:04:47","slug":"lulas-vetoes-on-offshore-wind-bill-face-backlash-in-congress","status":"publish","type":"post","link":"https:\/\/murray.adv.br\/en\/lulas-vetoes-on-offshore-wind-bill-face-backlash-in-congress\/","title":{"rendered":"Lula\u2019s vetoes on offshore wind bill face backlash in Congress"},"content":{"rendered":"
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Energy sector pushes to reverse vetoes that critics say favor polluting sources and could raise electricity bills<\/strong><\/em><\/h6>\n<\/div>\n<\/div>\n
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05\/13\/2025\n<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n

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With Congress set to vote on the issue on May 27, Brazil\u2019s electricity sector is ramping up pressure on lawmakers to overturn President Lula\u2019s vetoes of controversial sections of Bill No. 576\/2021, which regulates offshore wind energy generation in the country.<\/p>\n<\/div>\n

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At the heart of the dispute are Articles 22, 23, and 24, vetoed by Mr. Lula for addressing issues unrelated to the bill\u2019s original intent\u2014so-called riders. Initially designed to unlock Brazil\u2019s offshore wind potential, the bill was altered during its passage through the Lower House and took on provisions far beyond its initial scope.<\/p>\n<\/div>\n

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These included mandates for the compulsory contracting of gas-fired thermal plants that must operate at least 70% of the time, extensions of contracts for coal-fired plants, mandatory purchases of energy from small hydroelectric plants (PCHs) regardless of market demand, and the postponement of benefits for distributed generation projects, among others.<\/p>\n<\/div>\n

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A study by consultancy PSR estimates that keeping the vetoed articles in place could cost Brazilian consumers R$545 billion in electricity bills by 2050\u2014equivalent to an average 9% increase in rates.<\/p>\n<\/div>\n

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\u201cBeyond the direct impact on electricity bills, these riders throw the sector into disarray,\u201d said PSR CEO Luiz Barroso. \u201cThey distort future auctions, increase power curtailments, affect free-market prices, damage institutional credibility, and hinder long-term energy planning. Worst of all, they consume the already narrow room in tariffs to fund needed investments, such as those related to climate adaptation.\u201d<\/p>\n<\/div>\n

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Luiz Eduardo Barata, president of the National Front of Energy Consumers, echoed the concerns, saying the unrelated provisions undermine current proposals aimed at reducing electricity costs.<\/p>\n<\/div>\n

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\u201cIf Congress overturns the vetoes, consumers will see immediate rate hikes, and the legal framework for offshore wind, which should promote the energy transition, will instead subsidize dirty, expensive generation,\u201d he said.<\/p>\n<\/div>\n

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Aware of the growing pressure, the president\u2019s office has launched a political effort to preserve the vetoes. The assessment is that giving in to economic interest groups would damage the government\u2019s environmental credibility and raise energy costs for the public.<\/p>\n<\/div>\n

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Should Congress reverse the vetoes, Brazil could end up with an offshore wind framework that paradoxically favors coal and gas, drives up rates, and undermines the country\u2019s clean energy future.<\/p>\n<\/div>\n

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ABEG\u00c1S, the association representing gas distribution companies, supports keeping the gas-fired thermal plants in the bill, arguing that it would enable the expansion of infrastructure and the use of natural gas inland. The group claims these plants would provide predictability and ultimately reduce electricity costs for all consumers\u2014both residential and industrial.<\/p>\n<\/div>\n

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The wind sector, which originally proposed the bill, is pushing back. \u201cSince when does the legislature decide what source of energy consumers will use, where it will be produced, and how much it will cost?\u201d asked Marcello Cabral, head of new business at ABEE\u00d3LICA, the sector\u2019s association. \u201cThat should be the job of energy planners\u2014the Energy Research Company (EPE) and the Ministry of Mines and Energy (MME), as the granting authority.\u201d<\/p>\n<\/div>\n

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While the wind power segment stands to benefit most from a regulatory framework, it sees other sectors taking advantage of the bill without accounting for the societal costs.<\/p>\n<\/div>\n

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The Brazilian Small Hydropower Association (ABRAPCH) is also lobbying lawmakers to overturn the vetoes. Its president, Alessandra Torres, called the effort a \u201cpositive lobby,\u201d arguing that there\u2019s misinformation surrounding the issue and that studies support the provisions advocated by the segment she represents.<\/p>\n<\/div>\n

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\u201cJust because it\u2019s an offshore wind bill doesn\u2019t mean we can\u2019t address other issues,\u201d Mr. Torres said. \u201cThat\u2019s always been normal over the years. Replacing 8 GW from the Eletrobras privatization law with 4.5 GW of small hydro is actually advantageous for consumers.\u201d<\/p>\n<\/div>\n

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Despite its green fa\u00e7ade, the vetoed articles could increase Brazil\u2019s greenhouse gas emissions by up to 25%, according to experts. In the case of coal, the bill calls for contract extensions for plants in southern Brazil through 2025. The controversy highlights an ESG dilemma: lawmakers argue that maintaining coal plants is necessary to preserve 36,000 jobs in Santa Catarina and Rio Grande do Sul.<\/p>\n<\/div>\n

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On the other hand, experts point out that the proposal runs counter to Brazil\u2019s environmental commitments just ahead of COP30. Luiz Fernando Zancan, president of ABCS\u2014which represents companies in the coal supply chain\u2014said keeping the plants online is essential for system reliability.<\/p>\n<\/div>\n

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\u201cDuring the 2023 blackout, it was the coal plants that kept southern Brazil\u2019s outage to just 15 minutes, while the Northeast was out for nearly five hours,\u201d Mr. Zancan said. \u201cWithout these rotating machines providing inertia, energy, power, and auxiliary services, the grid faces serious problems.\u201d<\/p>\n

*By Robson Rodrigues\u00a0\u2014 S\u00e3o Paulo<\/p>\n

Source: Valor International<\/p>\n

https:\/\/valorinternational.globo.com\/<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Energy sector pushes to reverse vetoes that critics say favor polluting sources and could raise electricity bills     05\/13\/2025 With Congress set to vote on the issue on May 27, Brazil\u2019s electricity sector is ramping up pressure on lawmakers to overturn President Lula\u2019s vetoes of controversial sections of Bill No. 576\/2021, which regulates offshore […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8106],"tags":[26107,26106],"class_list":["post-94150","post","type-post","status-publish","format-standard","hentry","category-murray-news","tag-face-backlash-in-congress","tag-lulas-vetoes-on-offshore-wind-bill"],"yoast_head":"\nLula\u2019s vetoes on offshore wind bill face backlash in Congress - Murray Advogados<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/murray.adv.br\/en\/lulas-vetoes-on-offshore-wind-bill-face-backlash-in-congress\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Lula\u2019s vetoes on offshore wind bill face backlash in Congress - 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