Electricity bills in Brazil are more expensive than in 77 other countries, a study shows.

Residential electricity bills in Brazil are more expensive than in 77 other countries when considering the population's purchasing power, according to a survey conducted by economist Daniel Duque of CLP (Center for Public Leadership), using data from 138 countries. 

In nominal terms, residential electricity in Brazil costs US$0,179 per kWh. When the price is adjusted for PPP (Purchasing Power Parity), the value rises to the equivalent of US$0,357 per kWh. 

Purchasing Power Parity (PPP) allows for a comparison of how much the same product or service weighs on the pockets of consumers in different countries, taking into account the differences in the purchasing power of each population. By this criterion, the Brazilian tariff exceeds that recorded in 77 of the 138 countries analyzed. 

The difference becomes evident when Brazil is compared to some of the world's largest economies. In China, residential electricity costs US$0,079 per kWh; in India, US$0,071 per kWh; and in Canada, US$0,122 per kWh, considering the nominal values ​​presented in the survey.

The comparison is also noteworthy because countries like Brazil, China, and Canada have large-scale electrical systems and a significant share of renewable sources, although they have quite different generation structures, taxation, subsidies, and tariff formation.

The price paid by the consumer does not only correspond to the cost of producing electricity. In the composition of the Brazilian residential tariff, generation represents 30,4% of the final bill.

Another 26,1% corresponds to the distribution of electricity to consumers, and 10,1% to transmission, responsible for transporting energy over long distances. 

In addition to the costs directly related to the electrical system, 18,1% of the bill corresponds to taxes and 15,2% to sector charges. In practice, this means that less than a third of the electricity bill is directly related to energy generation. 

The remaining costs are associated with the infrastructure needed to transport and distribute electricity, as well as taxes and policies funded through tariffs.

Energy losses also factor into the equation.

Another factor influencing tariffs is the losses recorded throughout the distribution system. In Brazil, total losses account for 14,3% of the distributed energy.  Furthermore, pPart of their production is made up of what are called technical losses, which occur naturally during the transmission of electricity through the grid.

Another 7,1% corresponds to non-technical losses, mainly related to situations such as theft, fraud, measurement errors, and billing problems.

Part of the cost of these losses, within the limits recognized by regulation, is considered in the tariff processes of the distributors. As a result, a portion ends up being incorporated into the tariffs and influences the final amount paid by consumers.

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