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Mercado Livre is responsible for 38% of the electricity consumed in the country

Abraceel also carries out mapping on CP 131/2022, which aims to collect contributions for the advancement of the ACL

09-09-22-canal-solar-Mercado Livre is responsible for 34% of the electricity consumed in the country

Brazil may experience the greatest expansion of Mercado Livre in 2024. Photo: Envato Elements

According to Abraceel (Brazilian Association of Energy Traders), the Mercado Livre of Energy is responsible for 38% of the electricity consumed in the country.

O August newsletter of the entity pointed out that the segment reached 28.926 consumer units, which represents an increase of 19% in the last 12 months. In other words, 4.533 units joined the ACL (Free Contracting Environment).

Another point highlighted is that the discount on the price of energy for consumers in the ACL reached 40% in the month, considering the difference between the distributors' average tariff (R$ 280/MWh) and the long-term price of Mercado Livre (R $169/MWh).

Government plans to open Mercado Livre in January 2024

About CP 131/2022

According to Abraceel, the vision of agents in the electricity sector was consolidated and converged even more towards the theme of opening up the electricity sector in Brazil, a reform already consolidated in more than 50 countries, but delayed by two decades in the country.

In August 2021, in the Grant Taking of the ANEEL (National Electric Energy Agency), there was already majority support for the expansion of the ACL to new categories of consumers.

Now, a year later, the agents returned to give their opinion and reaffirmed, in Public Consultation 131 of the MME (Ministry of Mines and Energy), the conviction that it is time to take another step towards expanding the liberalization of the Brazilian electricity market.

CP 131/2022, closed on August 24th, discussed the reduction of the load level to allow consumers to migrate to Mercado Livre. The consultation included a proposal from the MME to open the high voltage market in January 2024.

Given this scenario, Abraceel assessed that the opening of the remainder of Group “A” does not cause any impact on the remaining captive consumers, on the contrary, it may even reduce charges and subsidies paid by these consumers.

Furthermore, he highlighted the clear benefits that new free consumers will have when purchasing, for example, energy at a price 30% cheaper than the average price currently charged in the regulated market.

Abraceel Mapping

An exclusive mapping carried out by the Association showed that among the 69 statements from various agents, who contributed individually or jointly to CP 131, 93% were in favor of opening the high voltage market.

In total, 81% unconditionally (without restrictions) and 12% subject to some condition – the remainder, 7%, did not speak out. No agent was against opening the market.

Of the 69 contributions, 52 suggested a date for the liberalization of this market segment: of these, 94% agreed with the MME proposal and indicated January 2024 as the appropriate deadline. Only one suggested postponing the deadline to January 2026 and two others proposed an extension between 2024 and 2026.

If the MME listens to the majority and continues with its proposal, Brazil will experience in 2024 the biggest expansion of the Free Energy Market since its creation in 1995.

Analysis

For Rodrigo Ferreira, executive president of Abraceel, the entity's technical analyzes indicate that it is possible to deal with subcontracting scenarios from 2025 onwards.

“Evidently, studies that consider migration amounts higher than those estimated by the CCEE (Electric Energy Trading Chamber) and with all consumers eligible to migrate doing so on the day following release, indicate overcontracting scenarios.”, he said

“Common sense and international experience indicate that migration has a rhythm. We are being quite aggressive in considering 25% per year,” she reported.

According to Ferreira, it is worth pointing out that the surplus of contracts does not always mean losses for distributors and consumers, as the result will always depend on the purchase and sale value of this energy.

“In the last decade, for example, the average value of the PLD was higher than the purchase price of energy by distributors. Thus, if the energy market had already been fully open, any overcontracting by distributors during this period would have resulted in a reduction in tariffs for consumers in the regulated environment”, concludes the traders' statement.

Mateus Badra
About the Author
Mateus Badra

Journalist graduated from PUC-Campinas. He worked as a producer, reporter and presenter on TV Bandeirantes and Metro Jornal. He has been following the Brazilian electricity sector since 2020.

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