The Brazilian electricity sector is passing through a period of turbulence that transcends the ordinary seasonal fluctuations in prices and hydro-reservoir management. Over recent months, the energy trading segment has accumulated a succession of episodes of financial instability with direct repercussions for consumers operating within the Free Contracting Environment (ACL, or Ambiente de Contratação Livre). Among the most emblematic of these episodes was the compulsory disconnection of Boven Comercializadora Varejista de Energia (Boven), ordered by the Board of the Electric Energy Trading Chamber (Câmara de Comercialização de Energia Elétrica – CCEE) on 17 March of this year.
The Boven case, however, is not an isolated incident. The company had itself forewarned its clients in early March that it would be unable to honour its energy supply commitments from April 2026 onwards, attributing the situation to a liquidity squeeze and to difficulties in forming backed contracts, compounded by exposure to the Settlement Price of Differences (Preço de Liquidação das Diferenças – PLD) at elevated levels. In the aftermath, the CCEE also determined the disqualification of the retail function of other trading companies, including 2W Ecobank and Flash Energy. These events were compounded by recent episodes of litigation, payment default and contractual rebalancing claims, as in the case of Tradener.
More than isolated occurrences, these episodes reveal a broader environment of operational and financial fragility within the energy trading segment. They do not necessarily constitute a structural failure of the free market, but they signal a relevant risk: the direct impact of such events on confidence in the model itself.
This is a particularly sensitive point in the current regulatory moment. The full opening of the ACL, scheduled for completion by December 2028, depends on the implementation of a number of legal and regulatory measures still pending, in particular, those required for the entry of low-voltage consumers. In this context, a conspicuous mismatch is forming between the formal evolution of the market and the perception of security among consumers, especially smaller ones, who will soon be required to make contractual decisions without necessarily understanding the risks involved.
The principal regulatory gap in this scenario concerns the treatment of emergency supply in situations involving the disconnection or disqualification of retail trading agents. Although Law No. 15,269/2025 introduced the Supplier of Last Resort (Supridor de Última Instância – SUI) as a mechanism designed to ensure continuity of supply, the SUI's regulatory framework has yet to be finalised and is advancing at a slow pace.
Under the current wording of Article 15-C of Law No. 9,074/95, as inserted by Law No. 15,269/2025, the SUI will be responsible for ensuring energy supply on an emergency and transitional basis to consumers, in the event of the termination of representation by a retail agent, with remuneration determined by the Brazilian Electricity Regulatory Agency (Agência Nacional de Energia Elétrica – ANEEL) and potential cost-sharing among ACL consumers. It thus constitutes the principal institutional instrument designed to mitigate risks and provide market predictability in situations of disruption.
Given the delay, and notwithstanding that the first opening milestone for industrial and commercial consumers is now roughly eighteen months away, bodies including the Brazilian Association of Energy Traders (Associação Brasileira dos Comercializadores de Energia – Abraceel), the Brazilian Wind Energy Association (Associação Brasileira de Energia Eólica – ABEEólica), the Brazilian Association of Large Industrial Energy Consumers and Free Consumers (Associação Brasileira dos Grandes Consumidores Industriais de Energia e Consumidores Livres – Abrace) and the Brazilian Association of Electricity Distributors (Associação Brasileira de Distribuidores de Energia Elétrica – Abradee) have submitted representations to ANEEL and to the Ministry of Mines and Energy (Ministério de Minas e Energia – MME), emphasising the need to prioritise the regulation of the law, particularly on matters such as the opening to low-voltage consumers, the Supplier of Last Resort and over-contracting by distributors.
ANEEL itself, despite having mapped out an extensive regulatory agenda for the 2026–2027 biennium, has yet to conclude the implementation of this instrument.
The result is a regulatory paradox: the risk has been identified and the mechanism has been created in law, yet its operationalisation is not keeping pace with the market's transformations, a market that is already experiencing, in practice, precisely the situations the SUI is intended to address.
In the years ahead, millions of consumers will face decisions about their energy contracting arrangements, often without familiarity with technical concepts such as the PLD, contract backing or market structure. Although the legislation provides for communication, guidance and information initiatives, these are not, on their own, sufficient to sustain confidence in the model. That confidence depends, above all, on the perception that effective protective mechanisms exist in the event of adverse circumstances.
For this reason, the crisis affecting energy retailers assumes a dimension that goes beyond the financial and projects itself as a reputational event. For the consumer encountering the free market for the first time, the perception that a trading company may cease operations without a clear and immediate supply guarantee mechanism directly undermines confidence in the system.
Against this backdrop, there is a concrete risk that the market opening will fail to translate into effective migration, thereby hollowing out a significant part of its stated objectives.
The regulation of the SUI and the dissemination of information to consumers must therefore be viewed as essential prerequisites for the credibility of the free market model. Their implementation is necessary if the market opening is to take place in a manner that is safe, comprehensible and effective.