New opportunities for photovoltaic generation

A study led by the Brazilian Centre of Energy and Climate Changes (CBEM) showed that the price of photovoltaic solar power has already leveled the tariff of several concessionaries. Minas Gerais, Bahia and Pernambuco are the most competitive states for solar projects, whilst São Paulo and Santa Catarina offer photovoltaic energy with the least cost feasibility. São Paulo holds a low energy price and relies on limited solar radiation along the year.

The energy price increased this year, and the trend is that it will rise even more in the near future. Higher prices contribute to the evolution of the solar power industry by reducing the projects’ payback time, which is expected to drop from 12 to 8-9 years.

The Brazilian energy matrix - February 2014.

The Brazilian energy matrix – February 2014.

Today, solar power represent less than 1% of the Brazilian energy matrix. There are little more than 100 installed photovoltaic units among residences and stadiums in Brazil, accounting for 9MW. The market analysts identify two solutions for solar power to be effectively inserted in the Brazilian energy matrix, one relying more on individual initiative and the other on public incentives.

Distributed generation could rapidly add complementary energy, which would be very welcome in the current austere scenario, but would demand new specific credit lines. Alternatively, photovoltaic energy can gain scale with public energy auctions, as wind power did. But that depends exclusively on incentives by the government. This year, one of the energy auctions is going to be specific for solar power.

Solar power auction will generate demand for equipment

A preliminary study by the Brazilian Energy Research Institute (EPE) foresees that 3,5 kMW of solar power are to be acquired until 2018, out of 38 kMW of new generation for the same period. This depends on the Ministry of Mines and Energy and is not yet determined. It is for certain that this type of energy will be more expensive in an early phase in order to attract investors. However, the international prices are likely to decrease with increased production, and this will eventually happen in Brazil as well.

The solar power auctions are going to create a demand for photovoltaic panels, which need financing alternatives in order to be manufactured locally. The government is not interested in subsidizing the photovoltaic energy industry due to the wide variety of inexpensive energy sources that are available in Brazil, like wind and hydropower. Nevertheless, that does not mean it is not willing to create some incentives. BNDES will be evaluated as a solution for financing the production of the panels.

Maurício Tolmasquim (EPE) believes the same phenomena that happened to wind power production will now apply to solar power. Although opinions vary in details, the majority of the sector specialists agree that photovoltaic generation will benefit from the scenario installed in the energy sector today.

Source: EPE, Brasil Energia

Innovation Norway is responsible for promoting the Norwegian industry abroad. Our office in Rio de Janeiro manages Innovation House Rio, our business incubator office, and helps Norwegian companies in their efforts towards the Brazilian market.

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