The Brazilian government has approved a BRL15.6bn (US$2.9bn) loan to support the Brazilian power sector, in the context of the COVID-19 pandemic. The loan will come from public and private banks and will be coordinated by the National Bank for Economic and Social Development (BNDES). The loan payment will start in 2021 and will be completed at the end of 2025; it will be repaid thanks to an extra charge on electricity bills that will be introduced in 2021.
The financial impact of the pandemic on power distribution companies is estimated at BRL5,565m (US$1,050m), including BRL3,270m (US$617m) of payment defaults. Electricity consumption fell by 14% due to the pandemic and defaults in the sector rose from 3% to 13%. In mid-March 2020, the energy regulator ANEEL prohibited distribution companies to cut off power supply to residential consumers and companies of essential services for 90 days, even in case of default.