Brazil is Forced to Reduce Energy Consumption by 20%
September 24, 2001
Manufacturers Brace Themselves For Fallout of Government Mandate
São Pãolo — The Brazilian energy crisis has prompted the country's government to stipulate an across-the-board reduction of energy consumption. It is hoped the mandate will prevent a greater crisis blackouts.
The electricity consumed must be 20 percent less than the average of the three months' previous to the set date for rationing (June 1) for both residences and industries. Some industries, inlcuding the textile industry must cut use by only 15%. Consumers who do not obey the order to reduce usage will be heavily fined or be cut off.
Industrialists and technicians have been worried about the energy situation for years and have been asking that measures be taken. But politically, the issue was a hot potato and each president's administration threw it on the next. Now, under Brazil's President Fernando Henrique Cardoso, the country is facing the consequences.
According to the National Confederation of Industries, 75 percent of the country's industries were forced to cut production and 63.4 percent will have to reduce the number of work positions. Overall, industries estimate a reduction of approximately 9.5 percent in production, according to an NCI survey, many believe that production will decrease by more than 15 percent.
The president of the Brazilian Textile Industry Association, Paulo Skaf, said the textile sector has little to worry about and many of the big textile manufacturers agree, but they see that their work is cut out for them.
"We have had to find ways of cutting down on energy, and this means reducing working hours, turning off some of our machines, air conditioning and half the lights of the company," said Gustavo Abduche of Abduche Industria Nacional de Tecidos. "Fortunately the market is rather stagnant at the moment, but once it starts accelerating, we will have to increase production. Either we economize or we face the government and get overtaxed. It is a problem."
Tapecol decided to concentrate on textiles with higher aggregated value. We are using our most modern machinery which consumes less energy. We have also put some of our staff on holiday."
Tapecol's decision to focus on export because of a stagnant local market, is paying off now as it helps the company deal with the crisis.
Linificios Leslie, one of the most important manufacturers of linen textiles, will not accept orders less than 100 meters per article. "We are accepting larger orders to increase the machine production so that they work less hours per day. We only dye a minimum of 300 meters per color and we do not operate from 5:30 to 8:30 p.m.," said Elizabeth Lellis, president.
"We are asking for some help from Light, Rio's Energy company, since we need to produce more for export. 50% of what we manufacture is exported and we cannot afford to sacrifice this."
The company has no plans to invest in generators. "We need to invest in our own business — linen."
For the textile manufacturer, Tecidos Estrela which has just relocated, the mandate comes at exactly the wrong time. "We were allowed to transfer our energy load, but the problem is that we have invested in new equipment. We are in a larger area and we now print our own textiles," said Fernando Nazar. "This is a completely new situation for us and we are hoping that it will be taken into consideration. So far they [the Brazilian energy company, Eletropaulo] have been quite understanding." Nazar said he is trying to negotiate a loophole for his company to resume increased energy usage.
The textile manufacturer Lerma has managed to maintain production, but it was forced to reduce work hours. "This definitely affects our flexibility and timing," said Marielza Milani, owner.
However, Brazilian textile manufacturers remain upbeat despite the shortage. Several have guaranteed that the crisis won't affect their service and exports.
"Belonging to such an unpredictable market as Brazil's we have learned to face and survive the most difficult of situations," said Naszar. "Brazilians have had to be creative and to sew their way out of any crisis."
The country has cooperated with the energy rationing stipulated by the government and after one month the population has almost reached the 20% goal. F&FI
São Pãolo — The Brazilian energy crisis has prompted the country's government to stipulate an across-the-board reduction of energy consumption. It is hoped the mandate will prevent a greater crisis blackouts.
The electricity consumed must be 20 percent less than the average of the three months' previous to the set date for rationing (June 1) for both residences and industries. Some industries, inlcuding the textile industry must cut use by only 15%. Consumers who do not obey the order to reduce usage will be heavily fined or be cut off.
Industrialists and technicians have been worried about the energy situation for years and have been asking that measures be taken. But politically, the issue was a hot potato and each president's administration threw it on the next. Now, under Brazil's President Fernando Henrique Cardoso, the country is facing the consequences.
According to the National Confederation of Industries, 75 percent of the country's industries were forced to cut production and 63.4 percent will have to reduce the number of work positions. Overall, industries estimate a reduction of approximately 9.5 percent in production, according to an NCI survey, many believe that production will decrease by more than 15 percent.
The president of the Brazilian Textile Industry Association, Paulo Skaf, said the textile sector has little to worry about and many of the big textile manufacturers agree, but they see that their work is cut out for them.
"We have had to find ways of cutting down on energy, and this means reducing working hours, turning off some of our machines, air conditioning and half the lights of the company," said Gustavo Abduche of Abduche Industria Nacional de Tecidos. "Fortunately the market is rather stagnant at the moment, but once it starts accelerating, we will have to increase production. Either we economize or we face the government and get overtaxed. It is a problem."
Tapecol decided to concentrate on textiles with higher aggregated value. We are using our most modern machinery which consumes less energy. We have also put some of our staff on holiday."
Tapecol's decision to focus on export because of a stagnant local market, is paying off now as it helps the company deal with the crisis.
Linificios Leslie, one of the most important manufacturers of linen textiles, will not accept orders less than 100 meters per article. "We are accepting larger orders to increase the machine production so that they work less hours per day. We only dye a minimum of 300 meters per color and we do not operate from 5:30 to 8:30 p.m.," said Elizabeth Lellis, president.
"We are asking for some help from Light, Rio's Energy company, since we need to produce more for export. 50% of what we manufacture is exported and we cannot afford to sacrifice this."
The company has no plans to invest in generators. "We need to invest in our own business — linen."
For the textile manufacturer, Tecidos Estrela which has just relocated, the mandate comes at exactly the wrong time. "We were allowed to transfer our energy load, but the problem is that we have invested in new equipment. We are in a larger area and we now print our own textiles," said Fernando Nazar. "This is a completely new situation for us and we are hoping that it will be taken into consideration. So far they [the Brazilian energy company, Eletropaulo] have been quite understanding." Nazar said he is trying to negotiate a loophole for his company to resume increased energy usage.
The textile manufacturer Lerma has managed to maintain production, but it was forced to reduce work hours. "This definitely affects our flexibility and timing," said Marielza Milani, owner.
However, Brazilian textile manufacturers remain upbeat despite the shortage. Several have guaranteed that the crisis won't affect their service and exports.
"Belonging to such an unpredictable market as Brazil's we have learned to face and survive the most difficult of situations," said Naszar. "Brazilians have had to be creative and to sew their way out of any crisis."
The country has cooperated with the energy rationing stipulated by the government and after one month the population has almost reached the 20% goal. F&FI
