Chamber approves MP that extends exemption on electricity bills to up to 60 million people

The Chamber of Deputies approved on Wednesday, the 17th, a provisional measure that creates a new social energy tariff and extends discounts on electricity bills to up to 60 million people. The bill must be approved by the Senate and signed into law by President Lula (Workers' Party) this Wednesday to avoid its expiration.

Shortly before approval, three articles were removed, addressing other tariff models, changes to electricity contracting rules, and short-term market distribution risk. The agreement was made to streamline the text and focus on electricity exemptions for low-income families.

The main measure provides for a full exemption from electricity bills for families registered with CadÚnico that consume up to 80 kWh per month. In practice, a family in this situation that consumes up to 80 kWh/month will pay nothing. If they exceed this limit, they will only pay the difference. The main beneficiary groups include:

• Families with a monthly per capita income of up to half the minimum wage;
• People with disabilities or elderly people who are beneficiaries of the Continuous Benefit Payment;
• Indigenous and quilombola families; and
• Residents in isolated areas not connected to the national electricity system.

Another group, made up of families with per capita incomes between half and one minimum wage, will also receive relief on their bills. These families will be exempt from the Energy Development Account (CDE), which represents approximately 12% of the final electricity bill, as long as their monthly consumption does not exceed 120 kWh.

This discount band aims to create a transition between social tariff beneficiaries and consumers who already pay the full tariff. According to data presented by the government:

• 17 million families are expected to receive the full benefit of the new social tariff, reaching around 60 million people;
• 4.5 million families will have their electricity bills reduced to zero;
• the social discount should reach 21 million families, of which 8.5 million are already registered with CadÚnico.

Currently, the tariff offers a discount of up to 65% on electricity for consumers registered with CadÚnico with a per capita family income of less than half the minimum wage and beneficiaries of the Continuous Benefit Payment, the BPC, as well as families with a monthly income of up to three minimum wages that have a person with a disability.

The estimated cost of the new social tariff is R$3.6 billion per year , while the social discount represents R$850 million. These amounts will be covered by the CDE, which could generate an average impact of 0.9% and 0.53% on the bills of other consumers.

To balance costs, the government proposes reviewing subsidies for incentivized energy sources, such as solar and wind, whose contracts expire in the coming years. This could reduce CDE's costs by up to R$10 billion in the long term.

The report analyzed in the Chamber was presented by Federal Representative Fernando Coelho Filho (União-PE). The rapporteur, however, removed the sector's reforms from the text and maintained only the expansion of the social tariff. The changes will be included in the processing of Provisional Measure 1,304 , reported by Senator and MDB leader in the Senate, Eduardo Braga (AM).