Market Outlook: What Distributed Generation Investors Must Know and Do Before January 2026 to Ensure Operational Sustainability

Distributed generation (DG) in Brazil has entered a new stage of maturity. The sector is moving away from a period of rapid expansion driven by incentives and into a complex consolidation phase where performance, governance, and regulatory security will define asset profitability.

Market Outlook: What Distributed Generation Investors Must Know and Do Before January 2026 to Ensure Operational Sustainability

The future of DG will be shaped by four key forces: (i) tax reform, (ii) the opening of the free energy market, (iii) the end of regulatory and fiscal subsidies, and (iv) operational risk management. The first two will reshape the business environment; the latter two will determine who remains competitive or even survives.

Tax Reform: 2026 Is Not a Rehearsal

While some accountants claim that the impacts will only begin in 2027, the energy sector must be alert: the fiscal transition officially begins in January 2026.

That year will serve as a “mirror year” for Brazil’s Federal Revenue Service, which will monitor and assess how operational models are adapting to the new tax framework (IBS/CBS). This transition will have direct implications for all DG investment plants.

The most critical point? The mandatory issuance of invoices for all shared consumption transactions.

This is not merely an operational adjustment it requires early legal, contractual, and accounting restructuring. Poorly designed models can create serious financial liabilities in the future. Governance, tax planning, compliance, and accounting routines must be aligned and tested before the end of 2025.

At Nitia, we are already supporting our clients through this transition because professional management means anticipating, not reacting.

Market Opening and Curtailment: Indirect Impacts, Direct Risks

With full market liberalization expected in 2026, residential and business consumers will gain access to new energy purchasing options. This will put pressure on the shared DG model, particularly on less structured consortiums.

At the same time, the risk of curtailment generation reductions due to regional overload or centralized dispatch is becoming increasingly real. Plants with low predictability or lacking quick-response mechanisms may lose a significant portion of their revenue.

Both developments directly affect asset profitability and, in some cases, viability. This is where professional management becomes a strategic differentiator.

Investors supported by integrated management overseeing generation, billing, delinquency, distributor relations, customer engagement, fiscal compliance, and performance metrics are better equipped to handle market volatility and preserve long-term value.

The Next Two Months: What Must Be Done Now

• Review fiscal and accounting models: Map billing flows, contracts, invoicing, and ancillary obligations under the new IBS framework.

• Run impact scenarios: Simulate different models with and without curtailment, consumer participation fluctuations, and the effects of market liberalization.

• Update contracts and billing systems: Ensure the entire commercial, legal, and operational structure complies with the new regulatory and tax environment.

• Train internal teams and partners: Customer service, accounting, finance, and legal departments must speak the same language — integration is the new face of governance.

• Assess operational readiness or outsourcing needs: Not every investor wants or can maintain an in-house management structure. Partnering with a technical-operational BPO like Nitia can secure compliance and profitability while minimizing risk.

Conclusion: No More Room for Amateurism

DG remains an excellent investment opportunity but the next two years will act as a natural selection process. Those with solid fiscal and operational structures will grow; those clinging to outdated or informal models will accumulate liabilities.

The good news? There’s still time. The next two months are the ideal window to adjust course and safeguard future returns.

At Nitia, we are ready our mission is to support investors who operate with responsibility, transparency, and results in a market that no longer tolerates improvisation or inefficiency.

About Nitia

Nitia – Intelligent Energy Management specializes in the technical, commercial, financial, regulatory, and accounting management of distributed generation plants. With a proprietary methodology and a results-driven approach, Nitia acts as a full BPO for generators and investors, ensuring compliance, predictability, profitability, and clarity in operational management.

Nitia believes that governance and management are the pillars sustaining Brazil’s energy transition.

Paula Caetano Lima – Engineer, Specialist in DG Management and Regulation – Founder and Executive Director at Nitia – Intelligent Energy ManagementAlexandre Soares dos Santos – Financial Expert in Energy Project Structuring (Financial, Legal, and Tax) – Director of New Business at Nitia – Intelligent Energy Management

Market Outlook: What Distributed Generation Investors Must Know and Do Before January 2026 to Ensure Operational Sustainability