Worst Brazil drought in 20 years to up pressure on power grid -official

Power lines connecting pylons of high-tension electricity are seen near Brasilia
Power lines connecting pylons of high-tension electricity are seen near Brasilia, Brazil August 29, 2018. Picture taken August 29, 2018. REUTERS/Ueslei Marcelino

RIO DE JANEIRO, May 10 (Reuters) - Brazil's worst drought in two decades will force the country to depend more heavily on costly thermal power plants to compensate for reduced hydroelectric generation, the National Electric Grid Operator (ONS) director-general said.

According to Luiz Carlos Ciocchi, this could keep power prices high but he saw no risk of power shortages or rationing.

"If we did not have the pandemic and the economy was growing, we might have already had a (supply) problem last year," Ciocchi told Reuters on Friday.

Around three-quarters of Brazil's electricity is generated by plants driven by flowing water, one of the largest proportions for any country.

President Jair Bolsonaro said on Monday that Brazil is experiencing the worst water crisis in its history, warning that it poses major problems for electricity generation.

"We have been unlucky, right? Rain usually (falls) until March, and now we are already in the phase where there is no rain," he told supporters at the entrance to the Presidential Palace in Brasilia.

Last week the Electricity Sector Monitoring Committee - made up of government and technical bodies, including the ONS - approved potential extra measures to meet demand, including extra thermal generation and importing energy from Argentina and Uruguay.

In the traditional rainy season from November through March, rainfall was the lowest in 20 years, Ciocchi said, adding that the picture is unlikely to improve much until the end of this year.

"The good thing is that, with the lower (seasonal) temperatures, the (demand) load drops, but we are getting as much thermal generation going as we can," he said, adding that as much water as possible is being collected in reservoirs.

Reporting by Rodrigo Viga Gaier; Writing by Jamie McGeever; Editing by Richard Chang

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