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Brazil

Official Name:
Federative Republic of Brazil

National Designated Entity

Type of organisation:
Government/Ministry
Name:
Mr. Márcio Rojas da Cruz
Position:
General Coordinator of Climate
Phone:
+55 61 2033 7923
Emails:
cgcl@mctic.gov.br, mrojas@mctic.gov.br, sregina@mctic.gov.br, lidiane.melo@mctic.gov.br

Energy profile

Brazil (2014)

Type: 
Energy profile
Energy profile
Extent of network

National Electrification Rate (2009): 98.9%Rural Electrification Rate (2009): 92.0% The Brazilian National Interconnected System (SIN), as of 2010, consisted of approximately 96,140 km of transmission and distribution lines, predominantly of 230 kV and below. As of 2011, transmission and distribution losses in the country stood at 16.4%.

Renewable energy potential

SolarWith yearly average global irradiance levels of 5.5 – 6.0 kWh/m2/day, Brazil has a high potential for the use of solar energy. The country has over 150 solar water heater manufacturers, providing installations for residential-scale applications as well as hotels, hospitals and other larger projects. Successful operation of the country’s first grid-tied solar project (1 MW) in 2011, as well as increasing solar energy use in large-scale infrastructure projects (stadia etc.), is changing the climate for solar power in the country, although the technology is still seen as costly, and applications limited to remote areas of the country and projects that fulfil social needs (electricity for schools, hospitals). Recent targets from the government for 1,400 MW of distributed solar generation by 2022 have accelerated market development, with approximately 122 MW of utility-scale solar projects being awarded long-term power purchase agreements in the 2013 federal energy supply contract auction. WindBrazil has a potential for wind power of 143 GW. At the end of 2012, Brazil had 2.5 GW of installed wind capacity, enough to power four million households, accounting for 2 percent of national electricity consumption. In 2012 alone, 40 new wind farms came online, adding more than 1 GW of new capacity to the Brazilian electricity grid and creating 15,000 new jobs. This represents an investment of USD 3.43 billion (€2.63 billion), which is expected to increase to USD 24.50 billion (€18.8 billion) by 2020.Brazil currently has over 7 GW of wind power projects in the pipeline to be delivered by 2016, and the government’s Decennial Energy Plan (PDE 2021) sets a 16 GW wind installed capacity goal by 2021. The local Brazilian wind market is forecast to grow at over 2 GW annually. Biomass/BiofuelsMajor biomass sources are firewood, sugar cane products and other agricultural waste. Sustainable biomass could have a potential of 20 GW. The use of biofuel (ethanol) is promoted through the Brazilian Alcohol Program (PROALCOOL), which encourages the production of renewable biomass fuel as an oil substitute. Driven by blending mandates and strong competition between ethanol and gasoline, Brazil remains the second-largest market and continues to have a larger share of biofuels in its transport fuel consumption than any other country. In 2035, biofuels will meet 30% of Brazilian road-transport fuel demand up from 19% today. HydropowerWith over 262 GW of available large-hydro potential out of a total potential of over 520 GW, Brazil has one of the best hydro-electric regimes in the world. Brazil’s focus on hydro-electric capacity development has been the mainstay of its electricity supply policy for a significant length of time, and as a result the country’s installed hydro-electric was 79,905 MW as of January 2013. Significant hydropower expansion is planned under the country’s 2020 Energy Plan. GeothermalAs of 2005, Brazil had 360 MW of installed geothermal capacity, predominantly used in the tertiary sector for bathing and swimming heating, with just 4 MW being used for agricultural drying. Brazil has a significant low-temperature geothermal resource that has potential industrial use, although utilisation up until now has been low.

Energy framework

The Inter-American Development Bank (IDB), as of April 2008, was supporting several projects in the power sector in Brazil, notably the Renewable Energy Service Delivery Project: This project is a technical cooperation that seeks to implement several pilot projects on renewable energy services to isolated communities in Brazil.Law No. 10,438, of April 26, 2002, created an incentive program for renewable energy called PROINFA (Programa de Incentivo às Fontes Alternativas de Energía), aimed at stimulating the development of wind, biomass and small hydro plant projects in Brazil. Such program provided for the guarantee of energy purchases by the state-owned corporation Eletrobrás, under 20-years’ power purchase agreements, at attractive prices and exemptions or discounts in the payment of certain power sector charges. At the same time, the Brazilian Development Bank - BNDES (Banco Nacional de Desenvolvimento Social e Econômico) and other financial institutions, made available to these projects, long-term credit facilities. PROINFA was originally conceived to include two phases, the first one having already taken place, representing 144 renewable energy projects.In the first phase, the Program calls for the generation of 3,300 MW of renewable energy with a national business participation rate of 60%, aiming to maximize the country’s regional potentials, create jobs, reduce CO2 emissions through thermal (fossil) displacement, and promote energy contracts with differentiated conditions for conventional sources, as well as a specific tariff/MWh for each source. The second phase fixes a 90% nationalization rate and a 15% Brazilian electrical energy annual consumption rate to be supplied by these sources. The goals of this phase are expected to be reached within twenty years, and the price will be a weighted average between competitive hydroelectric and thermoelectric (natural gas) prices.PROINFA as described in the Decree No. 5025, 2004, was established in order to increase the share of electricity produced by projects designed based on wind power, biomass and small hydro hydropower (SHP) in the National Interconnected System (SIN). According to Law No. 11,943 of May 28, 2009, the deadline for the start of operation of these projects ends on December 30, 2010.As part of an overarching strategy to guarantee long-term economic growth, Brazil’s Government continues to focus heavily on investing in improving energy efficiency and sustainability. In this regard, Brazil’s National Development Bank - Banco Nacional de Desenvolvimento Economico e Social (BNDES), the Brazilian Innovation Agency - Financiadora de Estudos e Projetos (FINEP) and the National Agency for Electricity - Agencia Nacional de Energia Eletrica (ANEEL) announced in 2013 the launch of the Inova Energia Program (the “Inova Program” or the “Program”), which provides a series of subsidies and other incentives to assist Brazilian companies and technology institutes to develop and commercialize innovative technologies for the power sector, including solar power, smart grids and energy-efficient vehicles.This article provides an overview of each of the three areas, namely (i) smart grids; (ii) solar and wind energy; and (iii) hybrid and energy efficient vehicles, which are expected to benefit from the Inova Program (each of these three areas are also referred to as “themes”). The article also briefly describes the goals established by the Brazilian Government for the implementation of the Program, and the current status of the Program.The Alternative Energy Auction of July 2011 (Regulation Portaria MME 113 of Feb 1, 2011) authorises ANEEL, the national electricity regulator, to organise alternative energy auctions, and sets pre-qualification criteria for developers participating in the auctions. The Government has also sought to reform the biodiesel auction framework to include a resubmission procedure to stimulate competition, and an updated IT framework for ANEEL to process bids more efficiently, including a web-based bidding process.Brazil has already awarded more than 3GW of renewables capacity in 2013, with 15GW of wind and 3GW of solar projects registered for November’s A-3 auction and more than 20GW of renewables projects competing in December’s A-5 tender. With average wind prices less than US$50/MWh, this is welcoming result for the fledgling solar sector along with possible solar-only auctions in 2014. More than 150 companies have entered the market in anticipation of a solar boom, though Government support remains critical.

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