RIO DE JANEIRO, Dec 29 (Reuters) - Brazil’s state-run utility, Centrais Eletricas Brasileiras SA, may let its concessions to operate several financially troubled power distributors lapse because it lacks funds to maintain operations, a senior company source said on Tuesday.
If Eletrobras, as the holding company is known, lets the concessions lapse, the distributors, their assets and responsibility to keep electricity flowing to residential and commercial customers would revert to Brazil’s government.
Brazil’s government forced Eletrobras to take over seven small distribution utilities in remote Brazilian states several years ago.
The utilities had been unable to make a profit in regions where populations are small, frequently isolated and often too poor to pay the full cost of their power.
In recent days, Eletrobras approved a plan to sell of one of those utilities, Celg, next year. The distribution utility serves the fast-growing central-west agrarian state of Goias.
Discussion of the sale of the rest of the troubled distributors was put off on Monday after a general shareholders meeting.
Of the seven, only Celg has renewed its concession with the government.
The other six companies’ concessions expired in July and have been kept operating by a government exemption.
Of those six remaining distributors, Amazonas Energia, which serves part of the remote state of Amazonas, and Boa Vista, which serves the far-northern state of Roriama on Brazil’s border with Venezuela and Guyana, are the most likely to have their concessions lapse, the source said.
The source asked for anonymity because the discussions about the concessions with Brazil’s government remain private.
In late trading in Sao Paulo on Tuesday, Eletrobras’ preferred shares, its most-traded class of stock, rose 2.3 percent, the biggest one-day gain in 10 sessions. It closed at 10.30 reais, a six-day high. (Reporting by Rodrigo Viga Gaier, writing by Jeb Blount)