Brazil’s opposition announces lawsuits to block Provisional Measure to privatize Eletrobras

RIO DE JANEIRO, BRAZIL – Opposing the approval of the provisional measure enabling the privatization of Eletrobras, opposition leaders said they would file lawsuits in the Federal Supreme Court (STF) in an attempt to block the measure voted on this Wednesday, May 19, by the Chamber of Deputies.

The parties will lodge three different lawsuits in the STF -two petitions and an injunction. All of these lawsuits are related to the lawsuit alleging Non-compliance with a Fundamental Precept (ADPF) addressed by Justice Alexandre de Moraes in March of last year.

At the time, the Justice authorized the plenary sessions of the Chamber and Senate to vote on the provisional measures through the Remote Deliberation System, without the regulatory need for the texts to be submitted to mixed committees, for as long as the public health emergency caused by Covid-19 persists. The opposition seeks to overturn this decision from March last year and force the Provisional Measures to again be submitted to committees.

“We are against the procedure and the merits of this privatization,” said minority leader Marcelo Freixo (PSOL-RJ) in a press conference held in the Chamber on Wednesday. “A proposal this serious should not be processed as a provisional measure,” said opposition leader Alessandro Molon (PSB-RJ). “It is hasty to privatize at this moment, it is a very bad deal for the country,” he commented.

The opposition’s lawsuits are applicable to the Eletrobras Provisional Measure and also to all others currently being processed in Congress. If the Justice accepts the requests, the government’s texts will have to be submitted to congressional committees before reaching the plenary.

For the opposition leaders, Moraes’ decision in March 2020 is no longer valid, since other committees have resumed operations in the Chamber and Senate.

During the interview, the leaders said they disagree with several points in the Eletrobras Provisional Measure report submitted by deputy Elmar Nascimento (DEM-BA).

Plans and controversial sections

Nascimento kept several “plans” that increase operation costs in his report and, among the obligations the government will be required to fulfill in order to privatize the state-owned company, is the contracting of 6,000 megawatts from thermoelectric plants in several regions of the country and small hydroelectric plants (PCHs), as well as the extension of wind power contracts signed under the Incentive Program for Alternative Sources of Electric Energy (PROINFA). The three obligations result in an increase in energy costs for the end consumer.

“Is it the role of Congress now to include in a Provisional Measure how much energy and what type is to be purchased?” Molon asked at the press conference.

However, Nascimento removed controversial passages such as those that included a solution to the issue of compulsory loans and that empowered the National Electric Energy Agency (ANEEL) to intervene in the energy market and prevent market concentration, and not only in the case of Eletrobras, but in all companies in the electric sector.

Governors

Also in the debate in Congress, deputy José Guimarães (PT-CE) read a letter against the Provisional Measure signed by the governors comprising the Northeast Consortium.

“The federal government continues its efforts to privatize Eletrobras. Should this occur, once again the country’s development and the consumer’s pocket will be directly impacted. There are several issues involved in this project that need to be averted,” reads the letter.