WATER EMERGENCY ALERT is Issued as Brazil is Facing Drought
Earlier this month, the government issued a hydric emergency alert (AEH) for five of the twenty-seven federative units. It’s the first in over a century – more precisely, 111 years – which tells something about the seriousness of the situation.
The AEH will last from June through September when the rain season supposedly begins. It doesn’t sound like a big deal for a tropical country the size of a country with traditionally voluminous hydric resources.
However, the level of threat is now deemed “critical” by some agencies and institutes. Only a week ago, it was severe. Also, these states are some of the most industrialized in the country. A significant part of food production happens in these states.
Empty reservoirs mean no electricity. An increase in thermal-generated power (i.e., coal, oil, gas) has entered the system to try and make up for the decline. Still, authorities and Grid administrators must feel the need to consider some form of rationing.
As expected, they announced a rise in electricity prices. The drought will predictably cascade into production, transportation, and services, contributing to the (already) swelling inflation and most likely knocking the GDP down a few points.