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New increases of up to 50% in electricity tariff flags

The adjustment was mainly motivated by the deficit in hydroelectric generation last year

A ANEEL – The National Electric Energy Agency – announced today that it will authorize increases of up to 50% in the values ​​of the electricity tariff flags. The yellow flag and levels 1 and 2 of the red flag will undergo adjustments, which will be passed on to consumers by the energy distributors starting next month. 

The adjustment was mainly motivated by the deficit in hydroelectric generation last year, which forced the introduction of a new calculation methodology that takes into account the risk of blackouts in the country due to lack of rain. Thus, the readjustment aims to increase revenue to pay for the additional generation (thermoelectric) that will be necessary in periods of water scarcity.

The yellow flag was the one that suffered the biggest impact of the readjustment. Under this banner, the value went from R$1,00 to R$1,50 for 100 kWh consumed — a very significant increase of 50%. In the red flag, the value for 100 kWh consumed went from R$3,00 to R$4,00 at level 1 and from R$5 to R$6 at level 2 — adjustments of 33,3% and 20%, respectively.

See what the cost of electricity was like after the adjustments:

  • Yellow flag: $ 1,50
  • Red flag – level 1: $ 4,00
  • Red flag – level 2: $ 6,00

According to ANEEL The proposed increases will prevent the electricity sector from running a deficit throughout this year. In 2017 and 2018, the brands had losses of R$4,4 billion and R$500 million. These losses were later passed on to consumers in tariff adjustments that have already taken place.

With this adjustment, the consumer will begin to pay for the energy deficit expected for this year.

In short, Brazilian consumers will now start paying in advance for the generation deficit that will occur in the future, according to forecasts based on historical data. This deficit occurs because of the entry of thermoelectric generation (more expensive) during periods of drought. One solution to this problem would be to encourage renewable sources, especially in the form of distributed generation of electricity with photovoltaic systems. However, the changes recently proposed by ANEEL for normative resolution No. 482 (which regulates the distributed generation sector) could harm the solar sector.

A solution to the energy deficit would be to encourage solar generation by ANEEL.

However, the changes recently proposed by ANEEL for RN 482 discourage solar generation.

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