Customer prefers guaranteed discount on migration to the free market, says Armor Energia

by Andrea
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The guarantee of savings in relation to the prices charged by distributors is relevant for consumers in the free market, concluded a survey by Armor Energia.

Due to the recent opening of the market and the low knowledge of small customers, the tendency is to prefer contracts with guaranteed discounts. According to Armor Energia, consumer preference is for lower prices than in the captive environment.

Customer prefers guaranteed discount on migration to the free market, says Armor Energia

“The customer can opt for a guaranteed discount in relation to their current cost with the distributor. This model offers less predictability, as it depends on the concessionaire’s readjustment to determine the base electric tariff, but it gives the consumer confidence that they are making a decision that will generate benefits for their company”, says Armor’s administrative director, Fred Menezes.

Unknown terrain

With the recent opening of the free market for small and medium-sized companies in January 2024, migration is still unknown terrain for many entrepreneurs.

Due to the lack of knowledge on the part of consumers, sales companies invest in active prospecting for customers. The work also involves informing the potential contractor about the advantages of the free contracting environment (ACL).

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“The retail customer profile is generally still poorly educated in relation to the sector. Therefore, there is work to educate the customer before convincing them to migrate to the free market. Although clear benefits are offered to the consumer, it is first necessary to make them comfortable with the product to the point that they are confident that they are making the right decision”, says Menezes.

It is possible to negotiate prices on a monthly or annual basis. During periods of drought, contracts for some suppliers may be increased due to the risk of water scarcity.

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Possibility of discounts

Armor works with fixed prices and adopts the discounts on the green flag as a reference, without passing on the cost of changing the tariff flag, which is added to the distributors’ tariffs when there is less hydroelectric generation.

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Thus, the supplier claims that it is possible to offer a discount that varies between 20% and 40%, within a period of up to five years, depending on the customer’s consumption profile.

A survey by the Brazilian Association of Energy Traders (Abraceel) showed that, when compared to tariffs in the captive environment, prices charged on the free market are up to 49% lower in Brazil.

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Adherence to the free market is on the rise. The number of consumer units that migrated from January to October 2024 reached 20,973. The services and commerce sectors stood out among the segments with the most migrations.

The mark is three times higher than that registered in the entire year 2023, according to data from the Electric Energy Trading Chamber (CCEE).

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