On 12 August 2026, Decree No. 13,097/2026 (“Decree”) was issued, regulating the opening of the free energy market to consumers supplied at voltages below 2.3 kV.
The Decree provides for the free choice of electricity supplier from 25 November 2027, for industrial and commercial consumers, and from 25 November 2028, for all other consumers, and sets out the main conditions for migration, return to the regulated market and last-resort supply. To enable the market opening, the Decree also assigns specific regulatory and operational measures to the Brazilian Electric Energy Agency (“ANEEL”) and the Energy Trading Chamber (“CCEE”).
1. Background to the market opening
In accordance with ANEEL regulations, Group A comprises consumer units connected at voltages equal to or greater than 2.3 kV, as well as those supplied through an underground distribution system at voltages below 2.3 kV, while Group B comprises units connected at voltages below 2.3 kV.
As part of this market-opening process, Normative Ordinance No. 50/2022 of the Ministry of Mines and Energy (“MME”) established that, since January 1, 2024, Group A consumers may elect to purchase electricity from any concessionaire, permit holder or authorised entity within the National Interconnected Grid (“SIN”), with representation before the CCEE by a retail agent being mandatory for consumers with an individual load below 500 kW.
Against this background, the Decree sets out the timetable applicable to consumers supplied at voltages below 2.3 kV: the market will open on 25 November 2027 for industrial and commercial consumers and on 25 November 2028 for all other consumers.
2. Conditions for migration to the free energy market
To migrate from the Regulated Market (“ACR”) to the Free Energy Market (“ACL”), a consumer supplied at voltages below 2.3 kV must be represented before the CCEE by a retail agent and contract the supply for each consumer unit with a single representative.
In addition, the consumer must notify the distributor of the migration at least 90 days in advance, without prejudice to ANEEL establishing a simplified procedure with a shorter period and rules for supply portability.
As regards metering, the Decree provides that, subject to ANEEL regulation, migration may take place without replacement of the existing metering system. If the consumer opts for smart metering, the consumer may request the replacement directly or through the retail agent, provided that technical and communications infrastructure is available, bearing the corresponding costs.
Finally, ANEEL must regulate a standard product, with a reference price, to facilitate comparison between offers. Retail agents, in turn, must disclose the relevant contract templates, reference prices and general terms and conditions.
3. Tariff benefits and return to the ACR
Upon migration to the ACL, tariff benefits granted under the ACR cease to apply, including the Social Electricity Tariff and special discounts for irrigation and aquaculture. For this reason, the distributor and the trader must inform the consumer, prior to migration, that these benefits will no longer apply.
Accordingly, the consumer must choose between remaining in the ACR, preserving any tariff benefits to which it is entitled, or migrating to the ACL under market conditions.
If the consumer decides to return to the ACR, it must notify the local distributor one year in advance, a period that may be shortened by the distributor itself or under ANEEL regulation. Upon return, any applicable tariff benefits will once again apply in accordance with the relevant legislation.
4. Last-resort supply
To ensure temporary continuity of supply to consumers subject to mandatory retail representation, the Decree regulates the Last Resort Supplier (“SUI”), which provides last-resort supply to a consumer that is not in default under its ACL obligations and ceases to have retail representation in the circumstances provided for by the Decree.
In this context, the SUI may act in the event of termination of the contract by the retail trader, termination for contractual non-performance, provided that the consumer is not in default, or disconnection of the generator or retail trader from the CCEE or its subsequent disqualification from retail trading.
Until December 31, 2030, last-resort supply will be provided exclusively by electricity distributors; from January 1, 2031, other legal entities may provide the service, subject to ANEEL regulation.
While provided by distributors, the SUI will be remunerated through specific tariffs and a specific tariff charge. In this regard, the tariffs may not be lower than the energy tariff applicable to the relevant tariff subgroup and must increase progressively so as to discourage prolonged use of the service. ANEEL may also set a maximum service period, after which return to the ACR will be mandatory.
In addition, the SUI’s administrative costs and any involuntary deficits will be allocated among all ACL consumers in proportion to their consumption, while positive financial results will be returned for the benefit of those consumers.
5. Transparency, competition and comparison of offers
To organise the opening of the Retail Market, the Decree requires ANEEL to establish prohibitions on anti-competitive conduct, as well as deadlines and equal conditions for consumers undergoing migration.
In the same context, ANEEL may, in coordination with the National Data Protection Agency (“ANPD”) and in compliance with data protection legislation, regulate the processing and sharing of personal data held by distributors, traders and retail agents, on a non-discriminatory basis and with equal access.
The CCEE, in turn, must make available, subject to ANEEL regulation, a centralised platform for comparing products and prices offered by trading agents, as well as a list of qualified retail agents.
6. Next steps
Although the Decree already sets out the timetable and general rules for market opening, its implementation depends on supplementary regulation by ANEEL.
Accordingly, ANEEL must regulate, among other matters, the tariffs applicable to the ACR and the ACL, the standard product and its reference price, the charges associated with market opening and the SUI, simplified migration and portability, as well as the metering, meter aggregation, billing, collection and suspension-of-supply services required for retail trading.
ANEEL regulation and the operational measures to be implemented by the CCEE will be the key developments to monitor ahead of the market-opening stages scheduled for 2027 and 2028.