With the collaboration of Enio Fonseca
Initial considerations
In present-day Brazil, if you walk through practically any Brazilian city, whether in urban areas or even in the countryside, you will see that it is not difficult to come across solar panels on the roofs of houses, buildings, commercial establishments, or even in large solar farms or on land by the side of roads and in the middle of rural plantations.
The rapid growth of solar power generation has propelled Brazil to the milestone of 60 GW of installed capacity, making it the second largest source in the national electricity matrix, representing approximately 24,5% of the total. Today, the country has more than 4 million photovoltaic solar systems installed on rooftops, commercial buildings, and power plants.
Solar energy has expanded by about 70% per year, drastically changing the generation profile in the SIN (National Interconnected System):
- 2021 to 2023: The leap was dizzying. From an incipient share, solar power came to account for significant portions of the country's instantaneous energy.
- 2023: Produced 50.633 GWh.
- 2024: Production reached 70.996 GWh, with almost 58% coming from micro and mini-distributed generation.
- 2025/2026: Following the increase in capacity, the consolidated annual production of solar energy continued its strong expansion, surpassing the 80.000 GWh mark.
O tree Distributed micro and mini-generation (MMGD) has transformed the urban and rural landscape of the country, being considered by many as a victory for the energy transition and the consumer's right to choose. However, the behind-the-scenes aspects of this growth reveal a worrying side effect that the specialized press has begun to expose: the rise of so-called "solar energy theft."
The term refers to the illegal practice of expanding the generation capacity of photovoltaic systems — either by adding more panels or installing more powerful inverters — without proper approval and notification to the local distributor or the granting authority.
What was once seen as an isolated commercial infraction has transformed into a systemic risk, forcing the state and regulatory agencies to intervene to prevent a collapse in the management of the national electricity system.
The technical and economic impact: The "Duck Curve" and the R$16 Billion bill.
This accelerated expansion brings great benefits, but it poses complex challenges to the ONS (National System Operator), a situation that is aggravated by solar generation without centralized control by the granting authority.
- Stopped on the network (CurtailmentSince solar energy is intermittent and its peak production occurs during the day (when demand is usually lower), the excess of clean energy generation in certain regions has exceeded the capacity of transmission lines. This forces the ONS (National System Operator) to carry out operational cuts, generating losses of billions of dollars in unused energy.
- Safety and Load Ramp: The abrupt drop in solar generation in the late afternoon requires the system to quickly dispatch thermal or hydroelectric power plants to compensate for the loss of sunlight and meet peak nighttime consumption.
This is the phenomenon known globally as the "Duck Curve." During peak solar radiation, around midday, there is a massive oversupply of energy injected into the grid. However, as soon as the sun sets, solar generation plummets abruptly, coinciding exactly with the time when consumer consumption skyrockets, in the early evening.
To cover this sudden gap in the energy matrix, the system is forced to activate fast-response thermal power plants, which are significantly more expensive and polluting. When solar systems are expanded clandestinely, the ONS (National System Operator) loses visibility into the behavior of the actual load, and ends up operating in the dark.
Beyond the technical bottleneck, there is a significant financial impact of a distributive nature. The tariff discounts and incentives granted over the years to MMGD owners have generated an estimated cost of R$ 16 billion.
This amount is distributed through the CDE (Energy Development Account) charge, which directly increases the electricity bill for conventional consumers who cannot afford to install solar panels, creating a socially unequal cross-subsidy scenario.
The regulatory reaction: Public Consultation No. 009/2026 of ANEEL
Given the seriousness of the situation, the ANEEL (The National Electric Energy Agency) has taken drastic measures to curb what experts call a culture of transgression. Under the reporting of director Gentil Nogueira de Sá Júnior and based on Technical Note No. 148/2025-STD, the agency opened Public Consultation No. 009/2026, with a deadline for receiving contributions set for June 6, 2026.
The proposal profoundly alters the rules of the game and focuses on rigorously combating illegal expansions through four main pillars. The first of these is the empowerment of distributors, who will now act firmly as DSOs (Distribution System Operators), receiving support for broad oversight and technological monitoring of the network.
The second pillar establishes strict penalties, authorizing the immediate suspension of energy supply and injection if any unauthorized increase in power is detected. Thirdly, the text provides for the possibility of connection denial, giving distributors a legal basis to refuse new access requests in areas where the technical stability and security of the local network are already compromised.
Finally, the proposal includes a review of surplus energy, altering the method of compensation for injected energy to discourage oversupply that is harmful to the system during off-peak hours.
The current legal framework
Although the new penalties are on the verge of becoming stricter, Brazilian legislation already classifies the practice as irregular. Currently, the sector is governed primarily by two legal pillars.
Law No. 14.300/2022, known as the Legal Framework for Distributed Generation, established the transition rules for charging for the use of distribution infrastructure (the so-called "Wire B"), defining the rights and duties of micro and mini-generators.
Complementing the law, the **Normative Resolution** ANEEL Decree No. 1.000/2021 dictates the general rule for the sector. Article 8 explicitly states that any change that implies an increase in injected power requires prior approval from the distributor. Failure to comply with this step constitutes a breach of contract and tariff fraud.
Geography of solar energy: a territorial overview of the Brazilian market.
The Brazilian solar energy market has surpassed the historic mark of 43 GW (Gigawatts) of installed capacity in micro and mini-distributed generation, driven by more than R$ 140 billion in accumulated investments. However, the characteristics of the producers and the challenges generated by clandestine connections paint very different scenarios in each region of the country.
In the Southeast region, which holds the absolute leadership in connections and installed capacity, the market is strongly driven by São Paulo and Minas Gerais, the latter being a historical pioneer in tax incentives for the sector. It is in this part of the country that urban network bottlenecks manifest themselves most intensely and where the largest volume of fraud in residences and medium-sized businesses is concentrated.
The Northeast region stands out for having the highest capacity factor in the country, a reflection of its excellent solar irradiance levels. In addition to a strong presence of distributed generation, the region is a hub for centralized generation, home to large solar parks.
This high injection of energy generates a reverse logistical challenge, creating enormous pressure on the transmission lines that connect the Northeast to the rest of the National Interconnected System.
In the Southern Region, solar energy penetration is characterized by medium-sized systems geared towards agribusiness and rural cooperatives, with a strong presence in Paraná and Rio Grande do Sul. In these locations, expansions carried out without the authorization of distributors directly affect the stability of rural circuits which, due to their long-distance technical characteristics, are traditionally more sensitive to voltage fluctuations.
The Central-West Region is experiencing rapid growth focused on large-scale mini-plants that supply large agricultural properties and industries in states such as Mato Grosso and Goiás.
The Midwest has become a major focus of attention for regulatory agencies precisely because of the scale of illegal expansions, often specifically designed to inflate the profit margins of large investors.
Finally, the Northern Region holds the smallest share of the national market due to logistical and demographic complexities. Despite this, photovoltaic energy has grown strategically in the region, consolidating itself as a crucial economic alternative to replace isolated diesel-powered systems in the interior of the Amazon.
Conclusion: the need for the sector to mature.
The solar energy market in Brazil experienced a fascinating "gold rush," but one that operated on the edge of regulatory and technical sustainability. While many residential consumers carry out expansions without knowing they are committing an infraction, often misled by unscrupulous installation companies, the most alarming scenario involves corporate investors who deliberately ignore the rules to maximize their financial gains.
The expansion of micro and mini-distributed generation represents one of the most significant structural transformations in the Brazilian electricity sector in recent decades, establishing itself as a legitimate instrument for energy transition, decentralization of the energy matrix, and democratization of access to energy.
However, the consolidation of this new paradigm cannot occur outside the legal, regulatory, and constitutional order that underpins the National Electricity System.
The practice of illegally expanding photovoltaic systems, the so-called "solar theft," transcends the realm of mere contractual or administrative irregularity, reaching a sensitive constitutional and institutional dimension.
This is because such conduct directly affects the structuring principles of Public Administration and economic regulation foreseen in article 37 of the Federal Constitution, especially the duties of legality, efficiency, administrative morality and legal certainty, in addition to compromising the operational stability of an essential public service subject to a regime of collective interest.
From a constitutional-economic standpoint, the uncontrolled expansion of distributed generation without regard to technical and authorization rules also undermines the foundations of Article 170 of the Constitution, insofar as free enterprise and economic freedom are not absolute and must coexist with the regulatory function of the State, consumer protection, the reduction of inequalities, and the preservation of competitive and tariff balance in the electricity sector.
the performance of ANEELBy promoting Public Consultation No. 009/2026 and strengthening mechanisms for oversight, monitoring, and accountability, the State proves to be legally legitimate and constitutionally necessary, especially given its duty to guarantee the continuity, reliability, and affordability of public electricity services, as stipulated in Article 175 of the Federal Constitution.
The regulatory power exercised by the Agency does not constitute an arbitrary restriction on the expansion of solar energy, but a concrete expression of the principle of regulatory proportionality, which is essential to harmonize technological innovation, systemic security, and tariff fairness.
From this perspective, the future of distributed generation in Brazil will depend on the institutional capacity to balance energy expansion with robust regulatory governance.
The maturation of the sector will require not only greater regulatory rigor, but also regulatory predictability, regulatory intelligence, technological traceability, and a strengthening of the energy compliance culture on the part of consumers, integrators, investors, and sector agents.
Brazil's energy transition will only be sustainable if it is anchored in solid constitutional foundations capable of simultaneously ensuring innovation, systemic stability, legal certainty, and social equity. After all, in a structuring sector like electricity, the preservation of the public interest and the reliability of the grid must prevail as the central vector of all regulatory action.
The opinions and information expressed are the sole responsibility of the author and do not necessarily represent the official position of the author. Canal Solar.
Answers of 35
Marina, great article!
All illegal activity must be fought.
The authorities already had mechanisms in place to apply the appropriate sanctions to offenders.
I don't think it needed to get to this point; illegal electricity theft is a crime, it needs to be treated as such, and the perpetrators and sponsors need to be held accountable. The omission of these actions to combat it harms the entire population.
The same situation is happening with the drilling of artesian wells without authorization; those who use them think they own all the water on the planet.
I believe that if solar power generation is taxed, and everyone pays more taxes, this problem will be solved, and there won't be electrical overloads on the grids... just like when the red flags were created due to the risk of blackouts.
If everything goes according to plan, then they like money.
Money going into their account means there are no blackouts or overloads; just pay and it works.
I understand "Solar Theft" as theft of solar energy, which does not occur in the case of expanding photovoltaic generators, especially residential ones. The understanding has always been that a certified 8kW solar inverter can receive up to 20 panels, and the client, at the time of installation, could only install 15. After some time, they could complete their generator without the need for new certification.
This situation has happened a lot, so if there's an obligation to regularize, let's do it, and the distributors have to give a reasonable deadline for this, without shutting down the generator and without inventing absurd "fine" amounts. I believe everyone has regularized their generators, but they are trying to take advantage of this moment, with the approval of... ANEEL...to make more money! THE TIME IS FOR SENSIBLE ACTION!
The correct approach would be to invest in an off-grid system where you would automatically use electricity from the utility company when the LiPo batteries reach the minimum charge necessary to power the residence. However, companies that design this model charge very high prices. Therefore, labor costs are high to cover the corporate and individual taxes that fall on employees. Let's remember that we work until May 30th to maintain the privileges of the nation's powers.
BESS systems are the solution, and the author doesn't talk about it. Battery systems solve the problem and are much more efficient than thermal systems. An auction is scheduled for December. Will Brazil lose this race as well?
In the comments, I only saw opinions saying that the government wants profits. It would be good to inform them that the vast majority of energy has been privatized, and it's the shareholder lobby that wants profits; they force politicians to accept their arguments, thus screwing over the population.
A country programmed to self-sabotage, favor corruption and criminals, and demonize investors. It's bound to fail!
The solution is not to punish the consumer, but to modernize the system to make consumption cheaper.
Instead of investing in batteries to store excess energy during peak hours, as the rest of the world is doing, Brazil prefers to help its thermal power plant owners by passing the cost flags on to consumers.
I don't believe that energy consumption is much lower during the day, because most factories and businesses operate during the day.
Perhaps if the price of energy weren't so high, there would be less incentive to invest in solar energy.
The author is so well-educated that she doesn't know that "Brazil" is a proper noun and, therefore, is written with an initial capital letter; in the same way that she completely disregards the mother tongue and uses a feminine pronoun for a masculine noun.
Continuing with this functional illiteracy, she calls something a "cat" that, while potentially fraudulent, does not constitute theft from energy companies. As someone who claims to understand Brazilian reality, she ignores the fact that major energy suppliers have not been renewing/investing and/or paying their taxes and fines satisfactorily, while citizens in much of the country lack a continuous and stable energy supply, leading to the loss of equipment, food, and/or income.
The problem in our country is the irresponsibility of the state, which handed over the electrical system to (cronies), certainly for shady and nefarious interests, failing in its main role of overseeing these companies, nor demanding investments from them in improving the national electrical system. Now they come up with this nonsense that solar energy overloads consumers who don't have distributed generation, when in reality this is the fault of the concessionaires in collusion with an inefficient and irresponsible state; it always ends up with the consumer bearing the brunt of the misdeeds of a bunch of lazy people who plague this country…
The not-so-distant future, already well advanced but with somewhat restricted access due to costs, is OFFGRID. It's the solution against these primitive laws and regulations. Old poles, approximately 70 years old, in medium voltage, and what do we pay? For something first-world, with a lot of scrap that is Brazil's interconnected energy system. Why doesn't ANEEL (Brazilian Electricity Regulatory Agency) regulate the adaptation and modernization of the Brazilian electrical system to receive this solar energy without limits and also not hurt the consumer's pocket? Why can't I put 50% more panels in my project above my monthly consumption? Why so much limitation?! Our Brazilian distribution system is dilapidated. Increase substations, infrastructure to receive this energy. Soon I see myself with a smart grid limiting my injection at certain times of the day, which is unfair. Build mega battery storage systems in mega substations. Investment that solves the problem.
"Solar Cat," as far as I know, is an expression coined by the current Brazilian regime that wants to tax everything and everyone, including the sun! It's utterly absurd! If you have your own solar farm and want to produce your own energy, whether solar, wind, or hydroelectric, you shouldn't see anything wrong with that, unlike in other countries, such as the United States. Here in this country, they want to regulate everything. It's no wonder that many are going to Paraguay or other countries that have a more liberal economic vision.
The author doesn't mention battery energy storage, something that is already possible and has been implemented in other countries, which would solve the problem of excess energy during the day and shortages at night. We are in a paradigm shift, and Brazil, naturally suited for sustainable energy production, should not let this opportunity pass and give in to the lobbying of thermoelectric power plants. Even now, there is no longer a need for large hydroelectric dams as in the past.
The payment for that B-wire should have been mandatorily invested in more distribution infrastructure. But that didn't happen, and it still doesn't. That's the real reason we're experiencing technical difficulties in supply. What will solve the problem, Ingrid, is the return on investment, including the installation of large battery banks that can supply peak consumption times after storing energy in conjunction with peak production times. And there's no lack of technical capacity. What's excessive is the mercenary attitude and corruption that have always plagued this country.
The idea is to invest in hybrid inverters with batteries capable of lasting more than 24 hours, so during the day solar energy recharges the batteries and at night it uses the batteries (preferably lithium).
The truth is that power generators and distributors don't want to see their handsome profits replaced by free energy.
I agree. I would add a correction: the energy is not "free." It is paid for by the investor who buys and installs panels and inverters.
The article is biased in favor of the electric companies. Throughout the article, it's clear that the electric companies are complaining about losing ground to solar energy, especially since off-grid energy has grown significantly.
If you can afford it, buy solar panels. In 2-3 years you'll pay for them and live the rest of your life more comfortably, without paying exorbitant bills to electricity companies. And if you have batteries, even better, so when others lose power, you'll still have some. If it's off-grid, even better, because you won't depend on the electricity company at all. Of course, off-grid is more expensive because it depends on batteries to store energy, but it's still good.
This is completely unfair to the citizen! People buy solar energy equipment precisely to be self-sufficient, and the State still wants to profit at the taxpayer's expense. This is a country of thieves where solar energy, which should be free, is taxed to the citizen! Soon they'll want to charge for the oxygen we breathe.
If the power companies hadn't built so many power plants, there would be more energy available for small consumers, because in some regions they reject the projects claiming a reversal of flow, but there is energy available for the power company itself, and nobody, not even the... ANEEL Don't you see that?
Instead of "sabotaging" clean energy, paid for by the consumer, the ANEEL They should invest in infrastructure, reduce bureaucracy regarding batteries for independent production from the electricity grid, and claim a share of excess energy to decrease dependence on hydroelectric and thermoelectric power. If times are changing, why don't energy companies invest in modernization as well? They're great at collecting payments, but overall they deliver terrible service and charge exorbitant prices for it.
The right approach would be to invest in infrastructure improvements, reduce taxes on everything related to photovoltaic energy generation systems, and invest in energy storage units (batteries) to utilize the surplus energy produced during the day. Unfortunately, Brazil is going against the global trend by taxing solar panels, adding even more bureaucracy, and failing to invest in infrastructure and storage units.
It's very simple to solve this; the government that creates taxes just needs to eliminate taxes on batteries and encourage manufacturers to buy them with reduced interest rates, which will drastically reduce the Duck curve. But the truth is, we already know who will pay the price for this duck!!!
The government owns the sun, remember that! Generating energy at home is stealing from the government; you have to pay them for it…
That's something else!
The only truly free energy source for citizens already exists and it's called Solar Energy: an investment with a return in 2 years and a lifespan of 30 years. It's possible to eliminate expenses for electricity, gas, and even vehicle fuel in the future.
It's a matter of survival in the future.
There is a lack of tax reduction in the battery production chain and in the food production chain (Food Security).
May God awaken us.
That's right, you said it all.
It's a joke. Generating energy using your own resources and feeding it back into the grid is a cause for concern. Only in Brazil. That's why this nonsense isn't going anywhere. The government just needs to reduce the price of energy during the day and things will be resolved. And what if everyone who owns solar panels starts storing energy at home and stops feeding it into the grid? Would that solve the problem for the government? Let the people produce, because they're already being robbed anyway.
Funny how, when a product emerges to improve people's lives by reducing expenses, it's never enough for these organizations or companies. Because the fact that consumers reduce their expenses and improve their efficiency is called "expenses" by these extremely ambitious companies, because they've stopped making more profit. Ugh.
I've wanted to install solar energy at home for a long time. But one of the reasons I haven't done it yet is precisely because Neoenergia doesn't pass on the discounts to the consumer. Many people complain that they go through the whole process and Neo simply doesn't do its part. So, this issue of illegal connections ends up being the fault of the operators as well. If there's a regulation, and the consumer complies, why doesn't the supplier accept it and give the discount???
That must be why many people do it without telling anyone. ♀️♀️
As is common in our country, opportunism is practiced to increase profits across all sectors of society, and the public sector is no exception. The public sector, responsible for the energy sector, should act prudently to avoid harming those who live honestly and through hard work. The public sector should conduct studies to correct problems without seeking to increase profits beyond what it already earns, and punish those who break the rules; that is, only those who are wrong should pay for their crimes. This is what I expect as a citizen. This country already has too many injustices, starting with the public sector, which, on the contrary, should be a regulator, prohibiting corruption, but what we see is the opposite.
This is the same excuse as saying, "If this money weren't stolen, we could build x hospitals." If distributed generation didn't exist, these power plants and hydroelectric dams would be used in the same way. And another thing, there have ALWAYS been PEAK HOURS: LATE AFTERNOON, MORNING, AND NOON, ON EVENT DAYS. This excuse is for those who don't THINK and favor those who LOSE with distributed generation. The GOVERNMENT (REVENUE) invented the infamous SUN TAX and the DISTRIBUTORS AND GENERATORS.
Is daytime demand lower? Are factories and businesses not major consumers during the day, while at night households are the biggest consumers?