Drought: waterway is paralyzed in SP; government hires emergency thermoelectric plants until 2025 for R$ 39 billion

Due to the water shortage in the Paraná hydrographic basin, the Tietê-Paraná waterway, which traverses São Paulo, Paraná, Mato Grosso do Sul, Goiás, and Minas Gerais states, had its flow compromised, resulting in the firing of more than 400 employees of cargo transportation companies. The remaining water volume was destined to generation of energy.

According to the worker’s union (Sindasp), the situation may get worse in 2022. “It will depend a lot on the level of the river, whether it will rise or not. If there is no prospect of operations returning in January and February, the companies will certainly lay off everyone,” said Luizio Rizzo Rocha, president of the union, to UOL.  In November, the state was again hit by dust storms.

As a response to the energy crisis associated with the drought, the National Agency of Electrical Energy (Anel) contracted thermoelectric plants that will deliver 775.8 MW (megawatts) on average from 2022 to 2025. The emergency power contracted will cost the consumer at least R$ 39 billions reais.

The measure was the target of a public civil action that questions the contracting model and the impacts for the consumer, but Anel was authorized by the courts to go ahead.