Renewable energy

Brazil – opportunities within renewable energy sector

The Brazilian market for renewable energy continues to grow and attract international players. Brazil is, due to its size and abundance of natural resources, a true power house of clean and renewable energy. Innovation Norway Rio has a significant network into the sector and knowledge on how to best enter and succeed in the market.

Renewable energy

Brazil brings large opportunities within renewable energy sector (Photo: Thinkstock)

Increased focus on the production side has been giving by the regulators to onshore wind, solar and biofuels while energy efficiency, distributed energy and grid expansion and efficiency are also topics that have been identified as areas with significant potential. The country plans to invest approx. US$ 5bi in the next years into the grid only, including more than 10.000km of transmission lines.

Alternative energy sources constitute 44% of Brazil energy mix in 2014, and Brazil is the biggest consumer of renewable energy in absolute terms, due to the high share of biofuels and hydro consumption.

Will to invest
Brazil has taken in more than $10 billion in wind power investments since 2009 and the installed wind and solar capacity has more than tripled since 2013. Especially the wind power industry boomed in Brazil since 2009 developing a local supply chain and produces very competitive results compared to the other energy sources. The total capacity (incl. planned and under development of wind power accumulates in 2015 to 12GW. Thus, despite the great progress made in the sector, barriers, such as grid connections, transmission lines, operation and maintenance, transportation and logistics remain. The Brazilian wind power market shows great potential to both project developers and investors but also for providers of high-tech tools and services to increase efficiency. Statkraft owns and operates two wind farms in the north-east of Brazil.

Solar sources currently contribute to less than 1% of the installed capacity in 2015. However, Brazil’s Ministry of Mines and Energy announced last year the goal to deploy 7 GW of solar PV by 2024 starting almost from scratch and with last year´s first PV-only auction granting almost 1GW for solar projects with fixed PPA’s. Furthermore distributed generation of electricity in Brazil showed a remarkably strong growth trend in 2015, as the number of connections grew 308%. The figures account for micro-generation (systems up to 75 kW) and mini-generation (systems between 75 kW to 5 MW) with the majority of these systems being solar. Norwegian player Scatec Solar entered the Brazilian market with a significant investment into 2 solar power plants in the north-east of Brazil.

Growth in bio-power
Brazil’s bio-power sector has seen continuous market growth in the last years a with total of 12.3 GW capacity in 2014. Electricity production from biomass—primarily sugarcane bagasse and black liquor—in thermoelectric plants remained stable at 7.6% of Brazil’s total electricity generation. Furthermore Brazil has the most developed ethanol based fuel model with a blend of ethanol in gasoline of 25% and in Biodiesel of 8%. The sector also seeks to advance into more advanced generations of biofuels with interesting potential for Norwegian companies. Norway´s UMOE Bioenergy operates successfully an ethanol plant in the state of São Paulo.

Despite the current unfavorable economic and political scenario in Brazil the market for renewable energy continues to grow and attract international players. Maneuvering in the sector opposes many obstacles which may be most easily overcome by finding a suitable local partner and thinking long-term.  Innovation Norway Rio has a significant network into the sector and knowledge on how to best enter and succeed in the market.

Contact
If you would like more information, please contact:
Martin Nietz Martin.Nietz@innovationnorway.no

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