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How does the Free Energy Market operate?
To comply with the criterion of eligibility
To become an Agent in the Free Energy Market, the consuming company must meet certain requirements, both with respect to consumption as well as register on the Electric Power Trade Board - CCEE and, mandatorily, notify their particular Distributor company. Below you will find the criteria for becoming a consumer on the Free Energy Market.
Becoming an agent of the Free Energy Market
To receive acquired energy, the consuming company must also sign agreements for connection and use of the distribution systems with its local Distributor and adjust its metering system to the class required by the CCEE. See below how to migrate to the Free Energy Market.
Electric Power Trade Board (CCEE)
Purchase and selling transactions in this market are registered and booked by the Electric Power Trade Board (CCEE), a non-profits private entity, responsible for registering the operations executed in the Free Energy Market.
Differences between the Free Market and the Captive Market
Free Energy Market
Consumers are able to trade freely with several energy suppliers.
The Free Energy Market can be a viable supply option for the consumers of this input. This environment allows the free negotiation of conditions for supply which meet the requirements of energy both in the present and the future of your industry or commerce.
Consumers are charged tariffs regulated by the energy distributor for your region.
The Captive Market is the environment for contracting electric energy, the role of the consuming entity being a passive one since the energy is supplied exclusively by the local distributor, the tariff and other conditions for supply being regulated by the Brazilian Power Regulatory Agency (Aneel).
Advantages of the Free Energy Market
The company can choose its energy supplier and enjoy greater flexibility in the contracting of the term to be negotiated for price.
The system begins with the competition between the generating companies themselves and the energy traders. This competition induces a reduction in price and greater efficiency in services, including the innovation of products and services offered. Thus, your company gains in competitiveness by acquiring energy at lower prices than in the Captive Market and under conditions suitable to your consumption.
In the Free Energy Market, conditions are negotiated directly between the parties, in other words, the supplier of energy and the consuming company. Price, volume, term and form of readjustment are some of the aspects decided at the negotiating table. The free negotiation of the energy supply contract gives greater flexibility for adjusting supply to the needs and characteristics of each company.
The Free Market provides predictability of energy costs to the company since the contract can be negotiated at a fixed price, earmarked to an inflation index. For example, the tariff flags imposed by the Government do not influence the price which is fixed from the outset in the purchase/sale agreement.
Criteria for being a consumer in the Free Energy Market
Free Consumers: Consumers supplied in high voltage and with demand contracted with the Distributor, equal or more than 3 MW. Should their industrial or commercial unit have been connected to the electricity grid prior to July 7, 1995, the consumer must be supplied at a voltage equal or above 69 kV to be eligible for the Free Market.
Special Consumers: Consumers attended in high voltage and with contracted demand equal or higher than 0.5 MW can purchase their power supply exclusively from renewable and incentivized sources such as Small Hydroelectric Plants, biomass, wind and solar.
Amalgamation of loads to become a special consumer
Consumers with the same tax registration number (CNPJ) or located in an adjacent area (not separated by public rights of way) can join their loads to reach the minimum level of demand of 0.5 MW required to be classified as a special consumer. For example a chain of five stores (all with the same CNPJ), each one with 100 kW of contracted demand, may become a single special consumer by joining loads, since the sum of the five units together reach the required 500 kW.