Report: Eletrobras could intervene El Paso plant in sales dispute

Brazil's federally-owned power sector holding Eletrobras could take control of US power company El Paso's Amazonas plant in a dispute over power prices, Dow Jones reported. The 240MW plant sold its power to Eletrobras subsidiary Eletronorte, but the contract expired in January. Since then sales have continued, and El Paso expected automatic renewal of the 67 reais/MW prices it received until then. However, Eletrobras sought new terms and has withheld payment on the basis that it cannot pay for anything not in black and white in a contract. In the meantime, El Paso claims that the federal company has racked up 100mn reais debts for power purchases, and said that the Amazonas plant consequently has operating difficulties and could have to close down due to its inability to carry out maintenance, Dow Jones reported. While El Paso maintains that the closure is simply a possibility, Eletrobras took it as a threat. "If they switch off the plant, we'll occupy it, and we'll do it by force if we have to, because that's a matter of national security," Dow Jones reported Eletrobras head Luiz Pinguelli as saying. According to Eletrobras, both parties understand that the holding company is scheduled to give its approval at a November 12 board meeting for a solution to the dispute. The agreement would see Eletrobras pay 62.71 reais/MW for one year, and pay its debts to El Paso in five installments.