Electric companies still struggle to close the gap between their earnings and expenses due to the fact that prices are not reflecting real costs of service and their approximations have been hindered by successive tariff freezes enacted by the socialist government.
The federal government that will step down after the November 20 elections has two paths: cut expenses or raise revenues to try and slow the bloodletting.
The first option would entail ignoring the tariff deficit and would only increase investor uncertainty. The second option, to create a new tax on hydraulic and nuclear power, would merely veil problems temporarily. Our energy sector needs a makeover: in part to destroy any semblance of doubt about prices and in part to ensure costs are more just for clients and companies.
