The proposal presented by the ONS (National Electric System Operator), based on the study carried out by PSR and Daimon, to create a DSO (Distribution System Operator) controlled by distributors, requires a much more in-depth analysis than that carried out so far in technical forums.
The claim that MMGD (micro and mini distributed generation) represents a “problem” for the basic grid — especially with regard to net load forecasting — cannot be treated as sufficient justification for an institutional reconfiguration of the electricity sector of such magnitude.
From the point of view of regulatory and institutional architecture, the proposal is profoundly centralizing and reverses important advances that we have been consolidating in recent years towards the decentralization, digitalization and democratization of the electricity sector.
Transferring to distributors the power to act as DSOs, with the power to control and dispatch REDs (Distributed Energy Resources), is a decision that generates evident conflicts of interest — especially because these same distributors compete, directly or indirectly, with distributed generation solutions.
From the perspective of the operability of the basic network, it is correct to state that the predictability of the net load has become more complex with the growth of DG, especially in regions where penetration is high.
However, it is not technically acceptable to attribute the challenges of grid predictability and stability solely to DG. These challenges also arise from the structural rigidity of the planning model, the lack of transparency in distribution data and the absence of efficient mechanisms for active demand management.
The proposed solution — a DSO operated by distributors — runs counter to international best practices, which generally involve the creation of independent entities or neutral platforms with clear rules on governance, interoperability and non-discriminatory access. It is essential to ensure that DERs are integrated into the system in a transparent and competitive manner, and not subordinated to incumbent agents.
From a legal perspective, the proposal presents risks of misuse of regulatory purpose, as it expands the powers of distributors without express legal . Law No. 14.300/2022 established a framework for distributed generation with transition rules, preserving acquired rights and promoting a gradual migration to a more sustainable model.
The creation of a DSO under the control of distributors may imply undue interventions in the rights of prosumers, discouraging active consumer participation and generating legal uncertainty in the sector.
Furthermore, the lack of a broader and more transparent debate on the economic and regulatory impacts of this proposal is worrying. The Brazilian electricity sector is experiencing a decisive moment of reform, with legislative and sub-legal initiatives that aim to redesign the logic of commercialization, separation of ballast and energy, and market opening.
In this context, the DSO cannot be constructed as an institutional shortcut to resolve governance and distribution planning failures. Contrary to what we are seeing in Brazil — where DG, especially distributed micro and mini generation (MMGD), has been treated as a “problem to be controlled” — international experience shows that the most advanced countries in the energy transition have adopted a collaborative and integrative approach in the relationship between DSOs (Distribution System Operators) and Distributed Energy Resources (DERs).
In Europe, for example, countries such as , the United Kingdom, Spain and the Netherlands have been building a model for years in which DSOs are independent, neutral and technically capable operators to act as system facilitators, rather than as agents subordinate to the interests of incumbents. Distributed generation in these countries is treated as an ally of flexibility, decarbonization and grid efficiency.
Rather than viewing the growth of DG as a threat to load predictability, European DSOs are embracing solutions such as:
- Integration with active demand management systems (Active System Management);
- Local flexibility markets, where the consumer and the distributed generator are remunerated for services provided to the grid;
- Interoperable digital platforms, with smart metering and data accessible in real time;
- And, most importantly, regulatory arrangements that clearly separate the role of the system operator from that of the marketer/distributor, avoiding conflicts of interest.
In the United States, the trend is similar. Several states are adopting the Distribution System Platform Provider (DSPP) model, such as New York, where DG is encouraged as part of a broader vision of grid modernization, known as REV – Reforming the Energy Vision.
In Brazil, the study presented by the ONS proposes a model in which the DSO would be created within the distributors, with the power to control and dispatch the REDs, including DG. This arrangement, in addition to not reflecting international best practices, represents a setback in of operational neutrality, consumer freedom and openness to innovation.
It is important to emphasize that Brazilian DG has grown under a defined regulatory framework, with clear rules, including planned public incentives. Treating it now as a “monster” that needs to be tamed, as mentioned in the recent technical debate, demonstrates a reactive and unbalanced vision.
DG is not the villain. When well integrated, with adequate economic signaling, transparency, and technology, it is part of the solution for a cleaner, safer, and more resilient system. The real challenge is not to contain DG, but to modernize the grid, update regulation, and align incentives in a fair and efficient way.
Therefore, the creation of a DSO must be preceded by:
- A clear definition of institutional roles and responsibilities, with functional separation between operations and marketing;
- The creation of a neutral governance environment that allows for the control and coordination of REDs without favoring vertically integrated agents;
- Regulation based on data and technical evidence, with broad stakeholder participation — including representatives of civil society, consumers and distributed generators;
- Alignment with the principles of free competition, technological innovation and economic efficiency.
The modernization of the basic grid and distribution cannot be achieved through disguised centralization. The future of the Brazilian electricity sector must be anchored in the construction of a more open, transparent and resilient system — and not in the attempt to “tame” distributed generation through questionable institutional structures.
The opinions and information expressed are the sole responsibility of the author and do not necessarily represent the official position of the author. Canal Solar.
