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UPDATE 1-Brazil will not ration energy amid drought, Congress leader says

(Recasts with Congressional leader denying rationing)

BRASILIA, June 22 (Reuters) - Brazil will not institute energy rationing as a drought threatens to disrupt hydroelectric power plants, the leader of Brazil’s lower house of Congress said on Tuesday, reversing his earlier remark that rationing would be necessary.

Lower house Speaker Arthur Lira said on Twitter that he had spoken with the Mines and Energy Minister Bento Albuquerque, who clarified that the government is not considering any energy rationing.

“A voluntary incentive for consumers to efficiently use energy will be enacted,” Lira said.

The Mines and Energy Ministry on Monday denied that any steps were being taken to ration electricity in the country, repeating previous denials. The Ministry did not immediately respond to request for comment on Tuesday.

Earlier on Tuesday, Lira said he had discussed rationing with Albuquerque last week and a trial period of rationing would be necessary to head off a larger crisis. The Congressional leader had said the conversation occurred in passing, without specifics or draft measures being discussed.

Brazil’s hydroelectric dams are facing their lowest water levels in 91 years due to below average rain, according to the Mines and Energy Ministry.

State-run oil company Petrobras is studying a further increase in natural gas supplies to allow for more thermoelectric power generation to offset the drop in hydroelectric energy, amid broader discussions with electricity regulator Aneel on how to relieve the situation. (Reporting by Maria Carolina Marcello; writing by Jake Spring; editing by Richard Pullin and Michael Perry)

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