The discounts offered in the free energy market in relation to the regulated market should stabilize in 2025. In the view of experts, the pace of migration from last year could be slowed down, due to the large volume of exits from the captive environment that have already occurred.
Competition between suppliers is expected to intensify, while mergers and acquisitions may consolidate larger players.
Discounts in relation to prices charged by electricity distributors will possibly remain between 25% and 30%, according to projections from consultancy Envol.
Continues after advertising
“The price should not fall any further. Several companies will try, little by little, to stabilize their margins, because, obviously, the discount is relevant, they buy to resell, or else they have a portfolio that they can fit in at a higher price than they would sell wholesale”, stated the CEO of Envol, Alexandre Viana.
24 thousand migrations
By November 2024, 24 thousand companies had migrated to the free market, according to data from the Electric Energy Trading Chamber (CCEE).
Continues after advertising
Even without data from the last month of the year, it is a record. Consolidated information on 2024 migrations should be released in January.
According to the Free Contracting Environment Potential Migration Report (ACL), prepared by the National Electric Energy Agency (Aneel), by August 12,600 consumers will be able to exit captive contracts.
Continues after advertising
“We hope that the number of migrations will still be relevant this year, but it is natural that this will decrease over time. Possibly because the base that can still migrate decreases. The suppliers won over the consumers who are easiest to migrate, who have a lower credit risk, the consumer who is easier for them and brings more value”, said the technical director of PSR, Edmundo Grune.
Competition will intensify
The market dynamics can be changed, according to Grune, as competition between suppliers tends to intensify.
After the first wave of high and medium voltage customer migrations, completed contracts may be renewed at different prices. In this case, the companies’ strategies will be different.
Continues after advertising
Read more:
“The argument will no longer be how much you paid to the energy distributor, because you migrated a few years ago. So then it will become much more of a price competition with other suppliers. Because you are already there in the market and then it will become like a telephone market, with four companies offering you products”, he said.
Fewer number of players
As the free retail market consolidates, smaller groups may be absorbed by large players, like other countries.
“What we should see going forward should be a smaller number of sellers, but on a larger scale. In England, the market has been open for a few decades and that is what happened. What we have nowadays is a smaller group of larger companies”, he said.
Find out more:
Viana corroborates the thesis and adds that the adoption of innovations may be restricted to larger groups.
Storage batteries, seen as a solution to conserve solar and wind generation, are still considered expensive, but tend to be an innovation that will be more widely adopted soon.
“More structured and larger traders will be able to offer this solution, because it involves discussion with suppliers and involves having cash to carry investment. So, I imagine that storage could impact the market as early as 2025”, stated the CEO of Envol.
