Generators and traders are cautious about the prices of the Free Energy Market in Brazil. The reason is the fear of a drought in 2025, such as the drought that occurred last year and led to the reduction in the level of the reservoirs of the hydroelectric plants and the activation of the Red Flag by the National Electric Energy Agency (Aneel).
“It’s more fear than a foundation, in fact. (…) This context leads to a higher price, which encourages consumers to make longer contracts and not be hiring so close to delivery, so the contract market should also have a stir, ”says the CEO of Consultoria, Alexandre Viana.
Reservoir
According to data from the National Electrical System Operator (ONS), hydroelectric reservoirs in the Southeast, Midwest, North and Northeast are expected to arrive at the end of March at stable levels compared to the same period last year.
According to the director of regulation and market studies at Thymos Energia, Mayra Guimarães, energy prices are also being influenced by recent heat waves in the country. The rise in temperature led to successive records in energy consumption in Brazil in January and February.
With the high electric charge, prices at some times of the day have increased, especially between late afternoon and early evening.
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According to the CEO of the surroundings, another factor that influences the high price are the changes in the free market pricing model, which now takes more into consideration the energy that is being generated than the volume of hydroelectric reservoirs.
Structural tendency
“Prices of 2025 will be higher than 2024, this is a structural trend, which is here to stay. Even with better reservoirs, we will have higher prices, ”explains Viana.
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In addition, as free market contracts are closed with flat prices, that is, the price of energy is fixed throughout the contracted period, and Brazil has increased the use of intermittent renewable sources, such as solar and wind, the consequent variation of the price of energy reflects on agreements, according to Viana.
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Despite the high pricing trend, the Brazilian Association of Energy Traders (Abraceel) points out that the free hiring environment (ACL) reached 40% of Brazil’s load last year.
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According to the CEO of the surroundings, this market should reach 42% in 2025. The highest growth is expected to occur with small customers, represented by retailers, said Guimarães.
“It’s a challenge today, for generators and traders, customer conversion into the free market, because the customer acquisition cost is high, given that they are small customers,” says Viana.
