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FACTBOX - Brazil energy plan penalizes big spenders
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BRAZIL: May 21, 2001


BRASILIA, Brazil - Brazil's government presented a plan on Friday to counter a deepening energy shortage by penalizing consumers who fail to scale back electricity usage rather than though widespread power cuts.


The following are the main points of the plan, effective June 1:

HOME CONSUMERS:

Low-income consumers who use on average less than 100 kilowatt hours per month, or about 15 reais ($7) worth of electricity, will be exempt from quotas.

Consumers who use at least 100 kilowatt hours per month will be asked to cut consumption by 20 percent. Those who do not meet quotas may have their power cut for three days on the first infraction and six days on subsequent ones.

Brazilians who regularly consume between 200 kilowatt hours and 500 kilowatt hours, and surpass their quotas will have to pay 50 percent more for their excess energy. Consumption over 500 kilowatt hours will be levied with a 200 percent surcharge.

Around 65 percent of consumers in Brazil's southeast region, the most densely populated and economically important, use less than 200 kilowatt hours per month, roughly equal to one refrigerator, one lamp and four daily electrically heated showers per month.

For every one real (43 U.S. cents) saved beyond the quotas, home consumers will receive a one-real bonus. Low-income users not subject to quotas will receive two reals (85 cents) for each real cut from their bills.

BUSINESS AND INDUSTRY:

Businesses and industry with low electricity consumption rates will have to cut their power needs by 20 percent and those with high consumption rates by 15 to 25 percent. If they do not meet quotas, they will face power cuts and have to pay for excess energy at wholesale market prices. Reductions in excess of the quota can be sold back to the wholesale market or be accumulated as credit for future use.

PUBLIC LIGHTING:

Earlier this week, the government decreed a ban on outdoor night-time events, including soccer games and concerts, and a 35 percent reduction in street lighting.

ROLLING BLACKOUTS:

California-style rolling blackouts have been ruled out in the first phase of the energy program in hopes that conservation efforts will make up for Brazil's shortfall in hydroelectric generation, triggered by the worst drought in 70 years.


REUTERS NEWS SERVICE

Reuters



© 2008 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Reuters.
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21 MAY 2001
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