The full opening of the free energy market to all consumers already has a set date. But one question remains in the sector: will distributors be structured to absorb the migration of millions of consumer units starting in November 2027?
According to Ricardo Brandão, director of regulation at ABRADEE (Brazilian Association of Electric Energy Distributors), the deadline set in Law 15.269/25 could be longer, but he assures that distribution companies will be prepared to deal with the opening of the market within the deadlines defined by the law.
The organization argues that the transition should be gradual, with the goal of reducing the impact on consumers who will remain in the regulated environment. According to the association, the safe migration of low voltage depends on defining clear rules for the treatment of legacy contracts, one of the sensitive points for the sector.
The change represents a significant inflection point in the business model of distribution companies, which will now operate essentially as managers of the network infrastructure, including the integration and management of distributed energy resources connected to the distribution system.
“This requires a review of the tariff model to ensure that the remuneration for the wire service is sufficient and sustainable to cover the operational costs and investments needed to modernize and expand the network, guaranteeing the quality and reliability of the supply,” Brandão emphasizes.
According to Brandão, at least one relevant concern was addressed with the approval of the electricity sector reform: the sharing of costs related to over-contracting of energy will be borne by both free and regulated consumers.
However, this view is not unanimous among free market players. According to Franklin Miguel, CEO of Electra Energia, there is a risk of market concentration due to the presence of vertically integrated economic groups in both distribution and sales. "The market power of distributors is critical for the establishment of a retail market," he states.
According to him, consumer perception exacerbates the problem. Many do not clearly distinguish between the functions of distribution and marketing, which can lead to choices based on a direct association between the local distributor and the marketing company within the same economic group. "Such behaviors prevent the end consumer from making the best choice based on the product and conditions offered by the competing market."
To guarantee neutrality and competitive equality, Miguel advocates for a complete separation between regulated businesses and free retail. This includes prohibiting the use of shared names, brands, and visual identities; preventing the common use of labor, systems, and infrastructure; and forbidding privileged access to consumer data.
Another sensitive point in the transition is the protection of small consumers in a free contracting environment, especially regarding issues such as transparency, comparison of offers, and contractual risks. According to Miguel, recent experiences show that the country has the capacity to promote major transformations with adequate communication.
"Just remember the opening of the telephony market, where we had massive campaigns to clarify the possibility of choosing an operator. Similarly, we had campaigns to clarify and encourage the use of PIX (Brazil's instant payment system). The adoption of generic pharmaceuticals was also preceded by successful campaigns," the executive recalls.
The economic attractiveness of migrating to low voltage is also under debate. For years, the commercial discourse has relied on average savings of 35% for consumers who opt for the free market. With the end of discounts for incentivized energy, this calculation is likely to change.
According to Guilherme Ávila, CEO of Tradener, the financial appeal will depend on the future behavior of the regulated tariff, which is under pressure from the need to maintain the reliability of the system through the contracting of thermoelectric plants.
“Perhaps that huge savings no longer exist. But there are other benefits to being in the Free Market besides price: cost predictability, contractual flexibility, no overrun fees, and different payment methods. Things that the regulated tariff doesn't offer. Ultimately, imagine there's no price benefit at all. Then the consumer will choose between a rigid purchase from the distributor or a flexible contract in the Free Market, for the same price. For many, that's already an advantage,” he says.
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