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Brazil lifts coal imports to record as hydro struck lingers: Maguire

Brazil is set to import almost 900,000 metric tons of thermal coal this month, the highest regular monthly tally on record and 3 times the monthly average for 2024 so far, according to data from shiptracking firm Kpler.

The coal buying binge comes as a long-lasting dry spell has slashed hydropower output to three-year lows, leaving power manufacturers short on power-generating fuels heading into the hottest months of the year when electricity need peaks.

Power firms have actually also raised imports of liquefied natural gas (LNG) to their greatest because late 2021, showing that a. high rise in fossil fuel-fired generation is looming in South. America's largest economy.

Greater usage of nonrenewable fuel sources will in turn lift Brazil's power. sector emissions, which are currently at their greatest because 2021.

HYDRO DISAPPOINTMENT

Hydro power generally represents around 65% of Brazil's. utility-scale electrical energy production, with hydro-electricity. generation balancing simply under 40 terawatt hours (TWh) a month. throughout the first half of 2024, Cinder data programs.

However, in September hydro output was up to simply 28.7 TWh as. a drop in rainfall from the year before hit dam output.

Cumulative rainfall in Brazil's southeast - home to many of. the nation's greatest dam systems - was just 584mm (23 inches). over the very first 10 months of the year, according to LSEG.

That was 10% less than the average from 2019 through 2023,. and marks the 2nd straight year of less than 600mm of rain. over the opening 10 months of the year.

The drop in real hydro output likewise cut hydro's share of. Brazil's generation mix to simply 50% in September, requiring power. providers to enhance output from alternate sources in order to. satisfy system demands.

TIDY CUT

While Brazil has one of the world's cleanest power systems,. utilities will likely rely on nonrenewable fuel sources to generate much of. the lost hydropower as output from gas and coal-fired power. plants can be quickly adjusted to stabilize system needs.

Up until now this year, hydro dams have actually created around 63% of. total electricity supplies, wind farms have represented around. 15%, while solar farms have actually produced around 10%.

Nuclear plants have actually represented an extra 2.5% share,. while bioenergy plants - which mainly burn sugar walking stick pulp -. have actually produced an extra 1.5%.

The cumulative share of power generation from clean sources. up until now in 2024 is 92%, which stays among the highest. internationally.

Nevertheless, the staying 8% share of generation has come from. nonrenewable fuel sources, which look primed to be used in even greater. volumes over the coming months if hydro output stays impeded.

Natural gas has actually generated around 6% of Brazil's electrical energy. up until now in 2024, while coal and oil-fired plants produced an. extra 2.2%.

PEAK NEED

A high climb in total power consumption is also putting. Brazil's power companies under pressure to lift output.

Brazil's electricity demand over the first nine months of. 2024 is up nearly 7% from the exact same months in 2023, which is the. strongest growth pace for that duration given that 2021 when the. nation's economy recovered from COVID-19-related restrictions.

However total power need is likely to climb higher still. heading into 2025 as homes, factories and offices all dial up. the use of power-hungry cooling systems throughout summer.

Average temperatures in Sao Paolo - Brazil's most populous. city - can balance over 10 degrees Fahrenheit (5.6 degrees. Celsius) more during November through February than throughout the. other months of the year, according to Weatherbase.

Those greater summer season temperature levels - which can top 30C (86F) -. tend to increase making use of air conditioning system all the time, and. stress power networks.

To satisfy those higher demand levels, energies look set to. lift output from the country's coal and gas-fired power plants,. which will be well stocked from the arranged imports of both. coal and LNG that are en path.

A sharp rebound in rainfall levels could assist bring back. output from dam networks and restrict the total usage of fossil. fuels in 2025.

But for the rest of 2024 a minimum of, considerably higher. generation from coal and gas looks imminent, and suggests a flare. up in local power emissions will follow. << The opinions revealed here are those of the author, a. writer .>

(source: Reuters)