South Cone energy integration: a look from Brazil

Abstract

Purpose

The paper intends to offer an understanding of the regional energy integration in the South Cone of Latin America as perceived in Brazil.

Design/methodology/approach

It assesses the Brazilian need of energy imports to balance its supply to demand and then reviews the strategy followed by successive Brazilian governments in order to move forward the process of energy integration domestically and, more recently, regionally. The reaction of the Brazilian energy establishment to the integration strategy implemented in the 1990s is studied as well.

Findings

The main findings of the paper are that the strategy pursued to regional integration (bilateral commercial contracts) is not providing the benefits originally envisaged and that the main reason for this outcome is the focus on the convergence of national energy regulations and policies.

Originality/value

To move the process of integration forward, the paper proposes that the focus should be on a multilateral agreement that can provide reliability to the national energy systems and can reduce domestic energy prices volatility as well. It is suggested that an agreement on the cooperative management of part of the large hydro and natural gas reservoirs available in the region offers the opportunity to institutionalize multilateral regional security reservoirs.

Citation

de Oliveira, A. (2007), "South Cone energy integration: a look from Brazil", International Journal of Energy Sector Management, Vol. 1 No. 2, pp. 122-140. https://doi.org/10.1108/17506220710761555