Energy theft – or popularly known as “electricity theft” – in distribution networks has been gaining increasing attention in Brazil amid the financial difficulties faced by some distributors. At the top of the list of concessionaires most affected by illegal connections, the most serious case occurs at Amazonas Energia, which at the end of last year was put up for sale on the market.
According to the most recent data from ANEEL According to the National Electric Energy Agency, the non-technical losses recorded by the company represented 122% of the energy distributed in the low-voltage market. Next came CEA (Companhia de Eletricidade do Amapá), with 85% of real losses, and Light S/A, with losses of 54% – this being another Brazilian distributor that is experiencing serious financial problems.
At the beginning of the month, the Rio de Janeiro company – which serves 4,3 million consumers in 31 of the 92 municipalities in the State of Rio de Janeiro – filed a request for judicial recovery alleging a debt of R$ 11 billion. Even though they know that this is a crime covered by law, many Brazilians believe that illegal connections do not have an impact on the lives of ordinary citizens, since they think that the loss would be 100% borne by the distributor itself.
However, as explained by the ANEEL, energy thefts affect both consumers' pockets and distributors' cash flow, since part of the losses are assumed by the distributor and its shareholders and another part is ed on to the of the customer who is under the concession area affected by the crime.
In other words, if a large number of people steal energy in municipalities supplied by Light, for example, part of the loss ends up being ed on to consumers who pay the electricity bill correctly every month to this distributor in question.
Social and cash problems
Bernardo Marangon, managing partner of Exact Energy and an engineer with experience in energy projects, explains that the more non-technical losses there are, the higher the electricity bill for residents becomes. “Consumers who are acting within the law end up having to pay a large part of the bill for those who are failing to meet their obligations. Furthermore, as the tariff increases, more people end up feeling entitled to commit crimes, thus creating a very negative spiral for all parties”, he highlighted.
According to him, in some regions, energy theft tends to be much more common and difficult to combat. “In Rio de Janeiro, for example, there are regions where the police have difficulty entering. So how can a distributor prevent energy thefts from occurring in these regions? It is very difficult and depends on the State’s action,” he pointed out.
According to a survey by the Map of Armed Groups, by Geni-UFF (Instituto Fogo Cruzado and the Study Group of New Illegalisms of the Universidade Federal Fluminense), only in the Metropolitan Region of Rio de Janeiro the areas under the influence of armed groups rose from 8,7 % in 2006 to 20% of the territory in 2021.
Still according to the professional, the country needs to find solutions to the problem for the good of all. “We need to think about technologies and ways to try to reduce these losses, because we are reaching a limit where utilities like Amazonas Energia and Light are becoming unsustainable”, he pointed out.
“I believe that there are other reasons besides theft that led these distributors to the situation they are in, as other distributors managed to solve this problem, but, in fact, we can say that theft is the most latent problem to be solved and that it contributed to the crisis financial situation of both”, concluded Marangon.
Energy thefts in 2022
Throughout last year, around 14% of the electricity distributed in Brazil was stolen or diverted, causing an estimated loss of more than R$7,7 billion, according to a study published by ABRADEE (Brazilian Association of Electric Energy Distributors), based on information from ANEEL. In total, the volume of energy stolen or diverted is equivalent to the average annual consumption of the states of Santa Catarina, Paraná, Mato Grosso do Sul and Espírito Santo. The North region is the one that presented the greatest losses, with Amazonas exceeding 100% of diversions in relation to the revenue from regular connections.
