After almost 18 months of negotiations, an accord has been reached over the payment of a debt of R$578 million owed by the Brazilian utility Eletrobrás to the country’s wholesale energy market. The accord, which requires the approval of the National Electricity Energy Agency, involves an immediate payment of R$185 million.
If the accord is finally ratified it will allow the wholesale market to start functioning normally. The debt has been affecting the financial viability of the market since September last year.
Part of the accord involves a insurance clause which will cover energy shortfalls between forecast and real production from the Angra I and II nuclear power units. It was the delay in starting Angra II which caused the problem by forcing Eletrobrás subsidiary Furnas to force the market to honour energy contracts.
The insurance will take the form of excess energy from generators and distributors. It will operate until December 2002. By then Eletrobrás is expected to have completed a 500MW thermal plant in Rio de Janeiro.
