Brazil announces energy rationing

Opposition legislators protest against energy rationing

By Jan Rocha in Sao Paulo

The Brazilian Government has announced drastic measures to tackle a looming energy shortage.

Rationing, which will come into force next month, will be heaviest in the most populous regions around Sao Paulo and Rio de Janeiro.

Cuts of about 20% will be imposed on domestic users and businesses, with heavy fines for those who do not comply.

The crisis has been caused by a drought that has dried up many of the country's hydro-electric power plants.

Hefty surcharges

The government's emergency plan to force reduction with a mixture of incentives and penalties has had mixed reactions.

Summer is over, but the lights are going out

One of the most controversial measures is that which orders energy companies to cut off power supplies for periods of three or even six days to households or industries which exceed the new reduced quotas.

The problem is that these quotas are based on the average consumption during three months of last year, even if they were atypical.

For consumers' associations, this punitive measure goes against the energy companies' obligation to supply an essential service.

Falling temperatures

There is also criticism of the hefty surcharges introduced on the bills of all consumers except those whose energy needs are very low.

The measures are expected to have a negative impact on employment, inflation and trade figures.

The need to save energy could not have come at a more difficult time in Brazil, the world's fifth largest country with almost 175 million people - summer is over and the temperature is dropping.

But the government stopped short of imposing rolling blackouts, which have affected the US state of California for several months.