Energy bill portability: What is it and how does it work?

Have you ever heard of electricity bill portability? In countries like Japan, Germany, South Korea, France, and the United Kingdom, it is a citizen's right. Around here, this portability is only available to large energy consumers (companies and industries), through migration to the Free Energy Market.

These consumers have the freedom to choose their energy supplier and, consequently, enjoy countless benefits. To understand what energy bill portability is, how it works, and what this change means, check out the content we have prepared below!

What is energy bill portability?

Energy bill portability represents the freedom of direct negotiation between consumers and generators or energy traders. To achieve this, it is necessary to have a contracted demand equal to or greater than 500 kW in a single company unit, or in two or more units, provided they are registered under the same CNPJ root, have a minimum of 30 kW of demand each, and belong to the same submarket.

Thus, low-voltage customers, such as households and small and medium-sized enterprises, are still restricted to the Regulated Contracting Environment (ACR). This means that, for now, they can only buy energy from the distributor to which they are connected and are considered captive consumers.

When requesting energy bill portability, the customer goes through a migration process to the Free Energy Market. Once completed, they are eligible to participate in the Free Contracting Environment (ACL). In this environment, consumers are divided into two categories:

1. Free consumers: customers with a contracted demand equal to or greater than 2,000 kW, eligible to contract any type of electric energy.

2. Special consumers: customers with a contracted demand between 500 kW and 2,000 kW. These customers can only buy incentivized energy from special sources.

Incentivized energy is that generated by solar, wind, biomass plants, or small hydroelectric power plants (PCHs), with a maximum capacity of 50,000 kW. The use of these sources through the Free Energy Market provides discounts on the Distribution System Use Tariff (TUSD). This discount is supported by the Energy Development Account (CDE), a charge present on the captive consumer's energy bill.

With energy bill portability, the adoption of this consumption model by all Brazilian citizens is being studied. The consequence would be the empowerment of consumers and, thus, greater competitiveness among energy companies, leading to price reductions and improvements in service quality.

How does energy bill portability work?

Brazil ranks 55th in the international electricity freedom ranking. However, there are initiatives to open up the energy market progressing in the Chamber of Deputies through Bill 1917-15 and in the Senate with PLS 232-16. In addition, sector bodies such as the National Electric Energy Agency (ANEEL) and the Ministry of Mines and Energy view the free market with optimism for the future of energy in the country.

Proof of this is the publication of Ordinance 465/19, which provides for the reduction of the limits between free and special consumers. This ordinance also establishes a schedule for the presentation of studies regarding the opening of the free market to consumers with a load of less than 500 kW by January 31, 2022, and the opening starting January 1, 2024.

Consequently, the Free Energy Market would be expanded to residences and small and medium-sized enterprises with a contracted demand of less than 500 kW. In other words, the project seeks to change the current commercial model of electric energy in Brazil.

In the long term, the operation of energy bill portability will be similar to telephony. Thus, consumers will have the freedom to buy energy from the supplier of their choice, while the relationship with distributors will be maintained. Energy bill portability ensures the management of the amount paid for electricity without breaking the relationship between consumers and the distributor, as the latter will remain responsible for transmission and distribution.

Advantages and disadvantages of energy bill portability

Every change brings advantages, but also disadvantages. Energy bill portability is no different. Below we list the main ones:

Advantages of energy bill portability

One of the strongest arguments in defense of electricity bill portability is the breaking of the monopoly. Since customers will no longer be forced to consume energy from local concessionaires, competition among companies should lead to improvements in service quality and price reductions.

In addition, consumers will be able to choose their energy source and thus opt for renewables, helping to preserve the environment thanks to the reduction of greenhouse gas emissions.

Another advantage is better management of electricity consumption. With the possibility of negotiating the commercial conditions of their energy contract, consumers are encouraged to gain more knowledge about the sector and thus use energy more consciously.

Disadvantages of energy bill portability

The disadvantages of electricity bill portability are related to the complexity of the Free Energy Market, as it brings challenges such as: managing energy consumption, analyzing contractual conditions such as prices and deadlines, as well as managing risks and uncertainties inherent to this market.

Captive consumers, unaccustomed to the negotiation freedom of the Free Energy Market, will need to pay attention to these factors when becoming free, in order to avoid unnecessary expenses.

Energy bill portability represents freedom of choice for Brazilian consumers. But to enjoy its benefits, planning, management, and care are required when deciding how to buy electric energy.

Make your portability happen with Serena!

With over 15 years in the market, Serena is a pioneer in wind, solar, and digital energy, offering customized solutions for consumers looking for clean and affordable energy. 

Capable of providing up to a 30% discount on the electricity bill, contracting can be done digitally or with a team of experts, without bureaucracy and with the choice of the ideal plan for you. 

Join Serena's prosperity network.