Why energy trader Migratio Energia is upbeat about growth

Brazilian power trader Migratio Energia expects to double its client base by the end of 2024 to 600 consumers, managing partner Hélio Lima told BNamericas. 

After growing by almost 30% in 2023, with revenues of 239mn reais (US$46.9mn), the goal is to reach 300mn reais this year.

Lima said that the opening of the market for group A (high voltage) has the potential to enable the migration of 165,000 consumer units, representing 6.5GWa in demand.

According to data from local energy traders’ association Abraceel, in March, energy consumption on the free market totaled 26,234MWa, or 36% of electric power consumed in the country. 

Lima said that smaller companies with energy bills of more than 8,000 reais and demand of less than 500kW, mainly in the industrial and commercial sectors, should drive growth.

"We're talking about various types of profiles: from churches to gyms, from bakeries to small industries," he said. "In addition, we see opportunities for agribusiness, as the regulation of the retail market also allows small 'individual' rural producers to migrate."

SAVINGS

A study recently released by Migratio shows that consumers in the free market in Brasília pay an average of 42% less than those served by the distribution concessionaire Cebdis (Neoenergia). 

The difference between the prices charged on the free and regulated markets in the country's capital is similar to that of consumers in the region of Energisa MR (Minas Gerais and Rio de Janeiro states), Cosern (Rio Grande do Norte) and Energisa (Mato Grosso), who have migrated to the free market. In these cases, the savings are 41%, 40% and 40%, respectively, compared to clients in the regulated market. 

The smallest difference indicated by the ranking is in Sergipe, in Sulgipe region. 

"Even so, we're talking about a difference in the price of energy of 13%," said Lima. 

Distributor	State	Regulated (reais/MWh)	Free (reais/MWh)	Savings
CEBDIS (NEOENERGIA DF)	Distrito Federal	600.06	346.58	42%
ENERGISA MG	Minas Gerais	642.45	380.77	41%
COSERN	Rio Grande do Norte	567.92	342.56	40%
ENERGISA MT	Mato Grosso	606.94	366.52	40%
CELPE	Pernambuco	537.41	334.41	38%
CPFL PIRATININGA	São Paulo	493.59	309.03	37%
LIGHT	Rio de Janeiro	615.48	386.64	37%
ENERGISA MS	Mato Grosso do Sul	597.47	375.92	37%
COELBA	Bahia	592.79	380.23	36%
ENERGISA SS	São Paulo	535.58	343.99	36%
CPFL PAULISTA	São Paulo	529.43	340.22	36%
EQUATORIAL PA	Pará	695.76	449.88	35%
RORAIMA ENERGIA	Roraima	514.47	335.27	35%
EFLJC	Santa Catarina	463.42	303.67	34%
ELEKTRO	São Paulo	574.92	377.54	34%
ELFSM	Espírito Santo	496.56	326.85	34%
CEMIG-D	Minas Gerais	541.06	359.76	34%
Equatorial PI	Piauí	590.44	394.86	33%
Equatorial AL	Alagoas	627.4	421.2	33%
COPEL-DIS	Paraná	503.74	338.38	33%
DCELT	Santa Catarina	463.47	311.7	33%
EDP ES	Espírito Santo	556.12	374.25	33%
RGE	Rio Grande do Sul	518.02	349.05	33%
ENERGISA SE	Sergipe	467.81	315.37	33%
ENERGISA AC	Acre	543.75	368.15	32%
HIDROPAN	Rio Grande do Sul	456.77	310.56	32%
CEEE-D	Rio Grande do Sul	518.64	355.21	32%
EDP SP	São Paulo	482.83	330.77	31%
ENERGISA TO	Tocantins	517.23	354.8	31%
Equatorial GO	Goiás	510.7	351.2	31%
ENEL RJ	Rio de Janeiro	625.57	431.15	31%
UHENPAL	Rio Grande do Sul	503.81	349.05	31%
CELESC-DIS	Santa Catarina	476.73	330.53	31%
EFLUL	Santa Catarina	476.73	330.53	31%
EQUATORIAL MA	Maranhão	505.21	350.29	31%
DEMEI	Rio Grande do Sul	500.8	349.05	30%
ENEL CE	Ceará	459.8	322	30%
ENEL SP	São Paulo	446.6	315.31	29%
CPFL SANTA CRUZ	São Paulo	502.52	357.67	29%
DMED	Minas Gerais	483.58	345.44	29%
AME	Amazonas	625.42	448.01	28%
CHESP	Goiás	486.03	351.2	28%
MUXENERGIA	Rio Grande do Sul	455.02	331.69	27%
CERON (ENERGISA RO)	Roraima	498.34	365.14	27%
FORCEL	Paraná	412.01	303.35	26%
ELETROCAR	Rio Grande do Sul	436.16	323.38	26%
ENERGISA PB	Paraíba	410.92	309.67	25%
COOPERALIANÇA	Santa Catarina	434.77	330.53	24%
COCEL	Paraná	400.12	309.15	23%
CEA	Amapá	521.2	425.88	18%
SULGIPE	Sergipe	371.01	321.39	13%

Source: Migratio Energia

One reason for the price differences is that, in the free contracting environment, the price is defined in a contract between the consumer and the energy supplier. The final price to be paid does not include many of the electricity charges common in the regulated market.

Examples include the fees charged at peak times and for the use of electrical distribution systems, which only partially affect the bills of those in the free market. 

Lima also highlighted that energy contracts for the regulated market are signed for periods of 20 to 30 years, with prices indexed to inflation and often under political influence to choose a certain energy source, which may not be the most advantageous for the consumer. 

"We therefore believe that the free market will maintain the same level of competitiveness over the next few years," said the executive.