In July, one of Brazil’s last coal plants in Candiota resumed operations after significant investment from Ambar, owned by billionaires Wesley and Joesley Batista. They believe that Brazil will continue to use coal despite having over 80% of its electricity from renewable sources. As Brazil prepares to host the UN climate summit COP30, President Luiz Inacio Lula da Silva expressed concern that the war in Ukraine has revived coal mining.
Coal plants, including Candiota, still supply 3% of Brazil’s electricity, highlighting the influence of special interest groups and the absence of a proper transition plan away from coal. Experts like Christine Shearer from Global Energy Monitor argue that Brazil has the resources to phase out coal, but the strong coal lobby in mining regions keeps these plants running.
The Candiota plant lost its government contract last year, leading to local economic downturns and outmigration. It now sells energy on the spot market during peak hours when solar and wind energy are less available. Nevertheless, Brazil’s Congress recently passed a bill allowing coal plants to operate until 2040, which Lula could potentially veto. The government also made coal eligible for a capacity auction aimed at improving energy security by using thermal plants during low renewable output.
Critics note that including coal in these plans contradicts the goal of energy flexibility, as coal plants cannot start quickly. They argue that poor long-term planning allows coal to persist, despite a surplus of clean energy that goes underutilized due to inadequate demand and transmission infrastructure. This situation makes the government susceptible to coal and natural gas lobbying, leading to higher financial and environmental costs.
Ambar asserts that coal from the Candiota plant is reliable and necessary for power supply, denying claims of relying on political influence. They also argue that critics prioritize the interests of large energy consumers over those of smaller entities and the broader public. Keeping coal operational aligns Brazil with countries like India and South Africa, where strong lobby groups impede efforts to transition away from coal, which is crucial to local economies.
Shutting down Candiota could result in around 10,000 job losses in the region. Local coal miner Jose Adolfo de Carvalho asserts that eliminating the plant won’t significantly impact global carbon issues. The future of the plant causes anxiety among residents, with former employee Graca dos Santos emphasizing the need for a just energy transition to avoid leaving the community jobless.
Lula’s administration lacks a transition plan for Candiota, and little progress has been made in strategizing for other coal facilities. Some suggest diversifying into sectors like beef, wine, and olive oil, which could provide new jobs for former coal workers. Local union leader Hermelindo Ferreira highlights the potential job losses from shutting down Candiota while recognizing that faith in the coal industry is wavering. Ferreira encourages workers to gain new skills, such as maintenance for wind energy, as a way to adapt to future opportunities.
With information from Reuters