Brazil will have cheaper electricity tariffs in October

The electricity bill in Brazil will be lighter in October, as expected.

On Friday, September 26, the National Electric Energy Agency (Aneel) announced the red flag level 1 for the next month, after two consecutive months of activating the red flag level 2.

This means that consumers will receive bills with an additional 4.46 reais (US$0.84) for every 100kWh consumed, compared to 7.87 reais/100kWh at the September level.

According to the regulatory agency, hydrological conditions remain unfavorable, requiring the dispatch of thermoelectric plants, which are pricier.

The trading company Armor Energia projects a yellow flag in November, with the possibility of a green flag in December, if there is an improvement in rainfall volume.

"Otherwise, the yellow flag should remain in December as well," Fred Menezes, the company's commercialization director, told BNamericas.

Under the yellow flag, the rate is subject to an additional 1.885 reais per 100kWh consumed. Under the green flag, there is no additional charge.

Fernando Borborema, energy studies manager at Grupo Delta Energia, pointed out that the rate flag methodology considers the energy reallocation mechanism (MRE) adjustment factor as the main variable, which is higher in the months with the highest rainfall intensity.

"Therefore, a new reduction in the rate flag is planned for the months of November, when the yellow flag should be activated, and December, with the green flag," he told BNamericas.

Walter Fróes, from CMU, assesses that the flag should remain red in the coming months.

"If there is a lot of precipitation in October and November, it might drop to yellow in December," he told BNamericas.

According to Fróes, the scenario is a result of the lack of rainfall in September – considered normal – and stricter risk aversion criteria adopted by the electric sector monitoring council (CMSE) to avoid potential rationing in 2026.

(The original version of this content was written in Portuguese)