Power Quest: Brazil Works to Wipe "Blackout" From the Lexicon

Facing domestic dismay over electricity service and new global attention as a world sporting event host, Brazil seeks energy solutions for a diverse nation.

When the lights go out these days in Brazil, the one word that Energy Minister Edison Lobão doesn't want to hear is apagão, or "blackout."

The word took on multiple meanings for citizens in the world's fifth largest nation after crippling power outages and government-mandated energy rationing in the early 2000s. Any massive failure of government or corporate officialdom-from plane delays to shortages of skilled workers-came to be branded as apagão. In last year's national elections, before Dilma Rousseff won the presidency in a runoff, there was vigorous dispute on Twitter over apagão, and which party had left more people in the dark most often. And last February, when 50 million people lost electricity for hours in the impoverished northeast, Lobão said it should not be considered an apagão, but a "temporary interruption of the electricity supply."

Keenly aware of domestic pressure over reliable electricity service, and knowing that the world will be watching as Brazil hosts both the World Cup and the Olympics within the next five years, public and private officials are working to bolster power delivery. But solutions are not easy in this sprawling country, South America's largest nation. While faced with feeding one of the world's largest cities, São Paulo, Brazil also is steward both to the Amazon and to more rural poor than any other nation in the Western Hemisphere. Brazil is roiled by conflict between city and village, development and preservation, as it considers how to fuel its economy and deliver future energy.

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Wide Reach, Many Complaints

AES Eletropaulo, which serves 6.1 million customers in São Paulo and the 23 cities in the surrounding metropolitan region, has plenty of critics. Procon, São Paulo state's consumer protection agency, lists it every year as one of the companies that receives the most complaints. The agency says blackouts are occurring more often in the city. A judicial sentence that took effect in August against Eletropaulo, in a case brought by Procon after a nationwide blackout in 2009, established that for any blackout exceeding four hours, the company would be fined 500,000 Brazilian reais ($300,000) for each hour of power outage beyond the initial four.

Despite frequent displeasure over outages, the reality is that electricity has wider reach in Brazil than any other public service, according to newly published figures from Brazil's census. The official records show the electric grid reaches up to 97.8 percent of homes throughout the country. In contrast, only 82.9 percent of homes have access to water supply, and just 67.1 percent of homes are hooked into public sanitation systems.

Energy consultant Roberto Kishinami, a former adviser to Brazil's government, described how private multinational companies developed the first power plants around São Paulo city in the 1920s, tapping the power of the Tietê River to generate electricity. While powering the industrialization of São Paulo, they left treatment of sewage to the same river, causing an environmental and urban problem for decades. Kishinami says water resources were viewed as a public good, and entrepreneurial spirit was unleashed to advance electricity. But these were not accompanied by commitments to efficiency or environmental protection.

Distribution of electricity is by no means equal across the country. In the poor northern states, including the Amazon, nearly one in each four rural homes still needs candlelight at night. But in São Paulo, only 1 in 2,000 homes lacks access to the power grid. As a result, more than 10 percent of Brazil's electricity is consumed in an area less than 1/1000th of the nation's size.

The most frequent power shortages in Brazil are actually in the poor rural areas where electricity coverage is limited, and where cities are small and sparse. Nearly 30 percent of the 65 incidents registered in the first half of 2011 by the national grid operator ONS (National Operator of the System), occurred in the Amazonian states of Pará, Acre, and Rondonia.

"I have worked in the north of Brazil," says Otavio Grillo, operational director of AES Eletropaulo. "Sometimes, power lines have to extend for 400 kilometers [248 miles] in the jungle to reach the population," he says. That, according to him, increases the chances that environmental factors will interfere with the lines.

(Related: "Amazon Opportunity: Brazil Doesn't Count on Carbon Market")

Official data kept by Brazil's National Agency of Electric Energy (Aneel) shows that blackouts in São Paulo are less frequent than in rural areas. When blackouts happen in the city, though, they affect areas vital to Brazil's economy; São Paulo generates 15 percent of Brazil's GDP. "We have the most critical clients in Brazil," says Grillo. When power outages happen in the north of the country, few outside the affected region hear about it, like a tree falling in the Amazon.

In São Paulo, due to the high concentration of energy consumers-more than 4,000 per square kilometer-any such disruption generates a swarm of complaints, making Eletropaulo's call center buzz. On the worst day, when a cyclone hit the city in July, there were 240,000 calls an hour. Eletropaulo issued a press statement that the outage should not be considered an apagão because only a few streets experienced outages.

Goal: Better Service

Pressure to improve the nation's electric service is expected to increase in the next five years, when Brazil's second-largest city, Rio de Janeiro-capital of state adjacent to São Paulo-hosts the finals of the 2014 FIFA World Cup and the summer Olympics in 2016. "Quero ver na Copa" has become a common remark when a Brazilian faces a lapse in any public service, including electrical: "I want to see what happens during the World Cup."

Power upgrades are integrated with construction planning for the events. In the capital of Brasília, a substation is being built just to power the national stadium for the games. In Paraná, just south of São Paulo state, the state power company is investing 500,000 Brazilian reais ($269,500) to improve the system for faster response to outages. In Rio, served by the electric company, Light, authorities are pouring millions of dollars into revamping the decades-old underground electricity and gas utility infrastructure. Last summer, exploding manhole covers became epidemic in Rio as sparks from old transformer junctions ignited gases beneath the street.

Eletropaulo says that since 2006 it has invested more than 3 billion Brazilian reais ($1.6 billion) in its network and it plans to invest a like amount before 2015 to improve services. This past summer, it announced a collaboration with General Electric and Trilliant to install smart meters and wireless communication to improve its electric delivery.

Brazil's government has put an emphasis on new energy generation, focusing on the same kind of development that has served the nation in the past: Hydroelectric, which currently provides nearly 85 percent of the nation's power. Regulators at the Aneel are discussing how to privatize power generators in Brazil's north, which currently are enterprises administered by Brazil's state-run Eletrobras. (Most other power companies in the country-like AES Eletropaulo-were auctioned away by the federal government in the late 1990s.) In the past five years, there have been ten auctions for licenses to build new power plants.

Three of the new hydroelectric plants would be in the Amazon, tapping the energy potential of the Madeira and Xingu rivers. But one project, Belo Monte, threatens to displace native populations, causing the Organization of the American States in April to demand suspension of construction. Brazil's government criticized the OAS move, and president Rousseff suspended Brazil's payment of $800,000 to the organization in retaliation. Lobão once attacked critics of the Belo Monte project as "the demoniac forces that are pulling Brazil down."

But the new hydro generation will only partially help address the electricity delivery problems that trouble Brazil's residents. Critics of Belo Monte are quick to point out that its power is likely to flow, at least in part, to new and growing industrial development. Brazil's giant mining company, Vale, and steelmaker Sinobras are shareholders in the consortium of government and private companies building Belo Monte.

(Related: "Updating the United States' Electric Grid With Flywheels and Air")

Hydropower Dependence

But getting power from rivers to the cities and industry has often been a challenge in a nation that is more than 8.5 million square kilometers (3.3 million square miles) in size. This is true even though Brazil has what Kishinami describes as "a very robust interlinked system," a grid that covers the entire country, north to south, east to west. "Few countries as big as Brazil have the same kind of [interconnection]," said Kishinami. (In contrast, the United States has no interconnection between its east and west grids and Texas is isolated on its own grid.)

(Related: "As Sun Storms Ramp Up, Electric Grid Braces for Impact")

In 2007, a blackout that left 3 million Brazilians in the dark was caused by accumulated soot in power line insulators. Such incidents are becoming less frequent, though. Aneel's official figures say the average Brazilian consumer loses power nearly 15 times a year, for a total of 18 hours, down from 21 times and 26 hours a year in 1998, when the agency was created.

But the general interconnection can allow trouble to spread far and wide. That's what happened on November 10, 2009. After a triple failure in energy transmission circuits, 18 Brazilian states were in the dark for as long as seven hours. The entire neighboring country of Paraguay also faced a brief power shortage, because the two nations share the second-largest hydroelectric dam in the world, Itaipu on the Paraná River. In Rio de Janeiro state alone, the outage cost industries 1 billion Brazilian reais ($539 million).

(Related: "Brazil Ethanol Looks to Sweeten More Gas Tanks")

Officials blamed strong wind and lightning for the power failure, although researchers have disputed these findings. Since the final report on the incident found flaws in maintenance of the transmission lines, Aneel fined Furnas Centrais Elétricas, a private company that manages power distribution, 53.7 million Brazilian reais ($28.9 million) -one of the largest fines in the agency's history.

It is not only the maintenance of the long transmission lines that is a problem, but the political tension that results from Brazil's decision to have power travel long distance from rivers in rural areas to its metropolitan centers in the south. Critics say the nation is both failing to serve the power needs of its rural poor, and threatening the culture of the indigenous people who rely on the rivers.

Kishinami believes that Brazil has focused on large hydroelectric projects to the exclusion of other energy alternatives, just as the building of roads has crowded out other transportation alternatives, such as trains and navigation by water. He believes Brazil should be spending more resources to explore technologies like biomass and solar energy to power rural communities. "Brazil has the challenge to incorporate new technologies to minimize environmental impact and make alternative energy an economic alternative," he said. In addition to "big solutions" in the interest of the nation, he said, "small solutions" need to be developed in the interest of communities. "We still don't have a planning system that's able to think in different scales and levels," he said.

This story is part of a special series that explores energy issues. For more, visit The Great Energy Challenge.

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