Foreign-Controlled Neoenergia Raises Power Tariffs

Aneel approved a 1.92% average tariff increase for Neoenergia Brasília on 20 October, effective 22 October, as the utility reported a 27% rise in third-quarter profit. Spain’s Iberdrola controls Neoenergia, which serves 17.2 million customers across five Brazilian distributors. The Brasília adjustment remains provisional while the distributor switches to a new billing system; any correction will come in the 2027 tariff adjustment.

Tariffs and Customers

The Brasília increase took effect on 22 October. Aneel set the distributor’s regulatory asset base at 2.2 billion reais, about US$437 million. On 27 August, regulators approved a separate average 9.58% increase for Neoenergia Elektro customers.

Neoenergia distributed 19,623 gigawatt hours of electricity in the third quarter, 6.0% more than a year earlier. The company said warmer weather and a larger customer base drove the rise. At the end of September, it served 17.2 million customers, up 2.0% from a year earlier.

The utility runs distributors in Bahia, Pernambuco, Rio Grande do Norte, São Paulo state, Mato Grosso do Sul and Brasília. In May, it announced 50 billion reais, about US$9.95 billion, in investment across its five distribution areas from 2026 to 2030, after three concessions were renewed. Capital spending in the first nine months of 2026 reached 6.17 billion reais, including 5.68 billion reais for distribution.

Foreign Ownership and Returns

Neoenergia reported third-quarter profit attributable to controlling shareholders of 1.177 billion reais, about US$234 million, up from 924 million reais, about US$184 million, a year earlier. The company published the results on 20 October. For the first nine months, though, profit fell 5% to 3.36 billion reais, about US$669 million, from 3.56 billion reais, about US$708 million.

Its networks business, which covers distribution and transmission, earned 1.10 billion reais, a 34% increase. Transmission alone earned 541 million reais, up 147%. On 30 September, Neoenergia took a 51% stake and control of Neoenergia Transmissão, previously shared with vehicles belonging to Singapore’s sovereign wealth fund, GIC, since 2023. The deal brought in 1.7 billion reais in cash.

Equity income and corporate deals contributed 345 million reais, compared with 31 million reais a year earlier. That total included a 292 million reais fair-value gain on the transmission deal with GIC. Neoenergia included the gain in EBITDA, but not cash EBITDA. The company didn’t provide the gain’s tax effect.

Debt and Investment

During the quarter, Neoenergia raised 10.4 billion reais through a 4131 loan described as cross-border, matched by debentures from five distributors; Iberdrola supplied 9.4 billion reais. Net debt stood at 52.2 billion reais, up 7% since December, or 3.44 times EBITDA. Gross debt was 71.7 billion reais, with 88% due long term.

Nine-month income tax and social contribution costs reached 720 million reais, compared with 79 million reais a year earlier. Neoenergia said its networks business had recorded a 770 million reais tax credit in the second quarter of 2025, affecting the prior-year comparison. Aneel allows a return on the regulatory asset base, which reached 48.2 billion reais. Neoenergia announced no dividend and gave no date for its next results.