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Enron Mail |
A short summary published today about the legal situation.
Growing Legal Problems for Energy Rationing Program The legal battle provoked by the government 's energy rationing program intensified Thursday with a S?o Paulo judge throwing out the program 's penalties. Thursday night,a judge in the city of Mar?lia,S?o Paulo issued an injunction suspending all of the penalties contained in the program for households or firms that exceed quota levels for electricity consumption.The injunction was in response to a challenge of the penalties filed by a federal prosecutor and is applicable to the entire country. The judge ruled that higher energy charges and the threat of a momentarycutoff of electricity for persons or companies that exceed their quotas were unconstitutional. Also on Thursday several Supreme Court justices stated that they have no doubts that a controversial decree issued by the government Wednesday is unconstitutional.The decree states that measures taken to combat the energy crisis do not have to respect Brazil 's consumer protection code.According to the justices,who declined to be identified,the decree violates three articles of the constitution. In S?o Paulo,the number of suits challenging the government program reached seven in the federal district court while in Rio a total of four suits had been filed by the end of Thursday. Thus far the government 's only response to the program 's legal problems has been to mobilize federal attorneys to overturn any injunctions issued by lower court judges.At some point,however,the government will also have to deal with the damage to its image caused by the unpopular aspects of the program. In related developments Thursday: *the head of the energy crisis management team Pedro Parente said that the government would consider a proposal defended by some electricity utilities to declare every Monday a holiday.Parente said his team would analyze the economic impact of such a measure which would be only be adopted if the current rationing program fails to produce the needed 20%cut in electricity consumption. * the government created a special group of energy experts to prepare the details of a program of rolling blackouts similar to what has been applied in the American state of California,also suffering from an energy crisis.Thus far blackouts have been ruled out in Brazil and would only be adopted if absolutely necessary. *the water level of reservoirs for hydroelectric plants is continuing to decline. According to figures for May 23,the average level in the southeast and central- west regions was 29.5%,down from 32%on May 1,a reduction of 7.5%.In the northeast,the average level fell from 32.6%to 28.5%over this same period,a reduction of 12.6%.Thus far the decline in consumption is not keeping pace with the reduction of generating capacity.For the week May 17-23,consumption in the southeast and central-west regions fell 4.6%and in the northeast the decline was 5.4%. *the Brazilian Association of Shopping Centers (Abrasce)proposed to meet its consumption quota by reducing the shopping period by two hours a day.Malls would open an hour later than at present and close an hour earlier. *the government is expected to announce today the energy quotas for specific business sectors.Each sector will be required to reduce its consumption by between 15%and 25%.
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