Water crisis in Brazil: National agency foresees increase of 21% in electricity bills in 2022

RIO DE JANEIRO, BRAZIL – The National Electric Energy Agency (Aneel) foresees an average 21% increase in the energy bill price in 2022.

“Our estimates point to a scenario of average tariff impact in 2022 of about 21.04%,” says Aneel, in an internal document published last Friday (Nov. 5) and revealed in a report by the newspaper O Estado de S. Paulo.

The agency projected the financial impact of the current water crisis in the country on the electricity bill.

In practice, the increase is three times higher for the consumer’s pocket than the one registered this year. The readjustment of the electricity bill in 2021 was 7.04%; last year, the accumulated increase was 3.25%.

To cover the costs of the thermoelectric plants, Aneel announced the creation of the “water scarcity flag” at the end of August. The value is R$ 14.20/100 kWh.

Until then, the red flag level 2 was the most expensive in the system. Since June, the tariff had already increased by R$9.49 for each kWh on the monthly bill. The new flag represents an increase of 49.63% in relation to the red flag level 2.

The tariff increase is a response to the drought in the main hydrographic basins that supply the country due to a low volume of rainfall in the Southeast and Midwest reservoirs, which account for 70% of energy generation in Brazil.