Brazil Will Let Households Pick Their Power Supplier in 2028

Energy

Brazilians have never been able to choose who sells them electricity. A draft decree now sitting in the president’s office would end that, and the dates it contains are the story, because the Brazil free energy market opens to households later than the government once said.

The energy ministry sent the text to the Casa Civil on Friday. It fills in a blank the 2025 electricity-sector reform deliberately left for a presidential decree.

Small commercial and industrial customers on low-voltage supply gain the right to switch from November 2027. Everyone else, households included, from the twenty-fifth of November 2028.

What the Brazil free energy market already is

Two markets sit side by side in Brazil. In the regulated one you buy from the utility that owns the wires outside your window, at a tariff the national regulator approves.

In the free one you negotiate price, term and source directly with a supplier. Since January 2024 every customer on medium or high voltage has been allowed in, which in practice means factories, hospitals, universities and warehouses.

The old rule required at least five hundred kilowatts of demand, and scrapping it let a far smaller class of business through the door. Those too small to trade directly are represented by retail agents inside the clearing house.

The result was visible last year. Services led the migration with nearly six and a half thousand new consumers, followed by commerce with just over four thousand.

That market is already large. According to the energy ministry, some eighty-five thousand participants bought about forty-three percent of all the electricity Brazil consumed last year.

Now do the arithmetic the announcements skip. Eighty-five thousand accounts already control nearly half the volume, so the remaining share is scattered across tens of millions of homes and corner shops.

The reform therefore multiplies the number of people who get to choose by several orders of magnitude, while adding a minority of the electricity. It is a retail revolution dressed as an energy one.

The date has moved, and that matters

When Lula signed the provisional measure that became the reform, the widely reported timetable had every consumer, households included, free to choose by December 2027. The draft decree now puts households eleven months later.

Eleven months is not a scandal. It is, however, a fact worth holding on to when the next round of announcements arrives.

Look at where the new date falls. Brazilians vote in October, and a president takes office in January 2027, so the residential switch-on lands in the back half of somebody else’s term.

The government writing this decree will not be the government that has to deliver it. The distributors, meanwhile, keep the role of supplier of last resort until the very end of 2030.

What actually changes on your bill

Nothing physical. The same poles carry the same current into the same meter, and the local distributor still answers when the lights go out.

What splits in two is the bill. One part pays for the wires, still regulated and still monopoly, and the other pays for the electricity, which you may now buy from whoever offers the better deal.

The closest analogy is mobile telephony. You keep the handset and the number and change the company that bills you.

The migration is spreading beyond the rich south. Last year the free market added roughly three thousand five hundred consumers in the Northeast, two thousand in the Centre-West and thirteen hundred in the North, alongside more than fourteen thousand in the Southeast and South.

For a foreign investor the read is straightforward. Retail electricity supply in a country of two hundred million people is about to become a contestable business, and the regulator has given everyone two and a half years to prepare for it.

A word of caution belongs here. Choice is not the same as savings, and a household that signs a bad contract will discover that the regulated tariff it left behind was also a form of protection.

The regulator has yet to write the rules on switching, on returning to the regulated market, and on who pays for the digital meters this all requires. Those details, not the decree, will decide whether the reform is worth anything to the person paying the bill.

When does the Brazil free energy market open to homes?

The draft decree sets 25 November 2028 for households. Low-voltage commercial and industrial customers gain access from November 2027.

Will I need new wiring or a new meter?

No, the distributor keeps the network and the connection. Only the commercial relationship for the energy itself moves to a supplier of your choice.

Is the decree final?

Not yet. The draft is with the president’s office, and publication is expected in the coming weeks, with the regulator still to write the detailed rules.

Frequently Asked Questions

When will Brazilian households be able to choose their electricity supplier?

Brazilian households will be able to choose their electricity supplier from 25 November 2028. Small shops and workshops will gain the right to switch supplier earlier, from November 2027.

How large is Brazil's free electricity market currently?

At the end of 2025, the free market held roughly 85,000 participants, accounting for about 43% of all electricity consumed in Brazil. This existing market will expand significantly once the new dates take effect.

Will local electricity distributors lose all their responsibilities under the new rules?

No, local distributors will retain control of the wires, outages, and meters — only the electricity supply itself becomes contestable. Distributors also remain the supplier of last resort until 31 December 2030, after which the regulator may open that role to others.