Loan to the electricity sector can alleviate expected high tariffs for 2022

The new loan to the electricity sector should ease the expected high tariff movement in 2022, in addition to mitigating an expected decline for 2023, according to TR Soluções, a technology company specializing in energy tariffs.

TR projections for the item that has impacted Brazilian inflation indicate that the loan may have an average effect of 3.41 percentage points on the estimated variation for the tariff this year, from 18.11% to 14.70%.

In 2023, the expectation is that financing will smooth the estimated drop, from 17.40% to 8.26%, on average.

The board of the National Electric Energy Agency (Aneel) approved at the beginning of the month the opening of the public consultation on a billionaire loan to the sector to alleviate additional costs incurred with the water crisis last year.

The maximum estimated value for the operation is 5.6 billion reais, but the agency also mentioned the possibility of deliberation of a second installment by May, of up to 5.2 billion reais.

TR simulations consider the tariffs of all classes of energy consumers. For the loan, they use as a premise the total amount of 10.8 billion reais, in addition to the base date of March 1 for the entry into force of the financing, an interest rate of 15% per year (Selic + spread) and the grace period of 10 months and amortization in 24 months.

“The simulations indicate that the loan is opportune because it induces the maintenance of tariff levels, mitigating both the sharp increases expected for 2022 and the sharp drops expected for 2023”, said, in a note, the managing partner of TR Soluções, Paulo Steele .

For this year, the prospect of higher tariffs reflects the maintenance of thermal generation, the increase in the Energy Development Account (CDE) charge and the increase in distribution service costs, pressured by inflation.

In 2023, the scenario of a significant drop in tariffs is mainly associated with the fact that 19 distributors will undergo a tariff review, with the expectation of a downward evaluation of the regulatory costs of some of these concessionaires.

If the tariff is reduced in 2022, the loan should act as a positive factor for the composition of the value of the electricity bill in the coming years, considering a premise that distributors will have a grace period of ten months to pay the financing.