Electricity sector unions met on Tuesday with João Daniel Cascalho, Brazil's national secretary for electric energy at the Ministry of Mines and Energy (MME), to discuss the impact on workers of a possible revocation of Enel's distribution license in São Paulo, according to the Painel S.A. column in Folha de S.Paulo. The meeting also addressed uncertainty over the renewal of Enel's contracts in Rio de Janeiro and Ceará states.
Union representatives said there is a lack of clarity about the future of these concessions and warned that the lack of predictability could affect company planning, investment and the maintenance of services provided to the public. Four organizations took part: the Sindicato dos Trabalhadores nas Indústrias de Energia Elétrica do Norte e Nordeste Fluminense (STIEENNF), the Sindicato dos Eletricitários de São Paulo (STIEESP), the Associação dos Eletricitários Aposentados de São Paulo (AEASP), and the vice presidency of the Associação dos Aposentados da Fundação Cesp (AAFC).
Revocation case nears final stage
The discussion comes as an administrative proceeding opened by Brazil's electricity regulator, Aneel, in April against Enel Distribuição São Paulo moves toward a conclusion. The case could strip the Italian-controlled company of its license to distribute power in the state, Latin America's largest economy. According to the trade outlet Canal Energia, Aneel rejected on August 24 a request by the utility for an expert technical review, pushing the case into its final evidentiary phase. The regulator had already turned down an Enel appeal against the opening of the proceeding on August 11.
Aneel's director-general, Sandoval Feitosa, told reporters it is not up to the regulator to weigh alternatives to revocation, since that political decision rests with the "granting authority," in this case the energy ministry. He said a "negotiated solution" mentioned by Mines and Energy Minister Alexandre Silveira would likely involve a transfer of control of the concession, a mechanism used in similar cases before, such as Enel's handover of its Goiás distributor to the Equatorial group in 2022 and the transfer of Amazonas Energia to the Âmbar group.
Feitosa said he hoped the case would be resolved "as quickly as possible," while acknowledging that the approaching elections make the situation more complex. "Uncertainty is bad for the end user, and bad for companies that need predictability for their investments," he said, according to InfoMoney.
Enel has publicly stated it does not intend to give up the São Paulo concession and argued in its defense filed with Aneel in May that it had improved the distributor's operational indicators. A final ruling in the case could directly affect thousands of workers in São Paulo's electricity sector, which is why unions are now pressing the ministry for guarantees.