South American PV sector given another boost by policy changes in Brazil

ANEEL, the Brazilian Electricity Regulatory Agency, has announced a proposal to implement two new policies that will likely see a considerable increase in the development of PV projects throughout South America. The first change in policy aims to stimulate new solar development in utility, through the reduction of taxes on energy produced by solar power plants by 80%. The second revision will be directed at increasing demand for small scale systems by creating a true net-metering system for residential and commercial installations.

This announcement illustrates the country’s serious commitment to solar energy and its intention to bring the policy changes into law, the changes were announced last month. As the continent’s largest economy, any rise in Brazil’s PV industry would also likely see an increase in domestic module manufacturing and sales as well as interest from foreign investors. It is hoped that the policy revision marks a new stage for the solar industry in South America and particularly in Brazil, where PV projects have historically been sparse and slow to develop, when compared to neighbouring countries such as Argentina, Peru and Chile.

As a result of the policy changes, solar market researcher NPD Solarbuzz projects a year-on-year growth rate of over 350% in the region, for 2012, with potential triple-figure growth until 2014. Analysis also indicates that new PV projects will be boosted by rapidly decreasing solar installation prices. In some areas of South America, including northeast Brazil, large-scale power generation projects are set to achieve grid-parity in the near future.

Projections have indicated that, if growth continues at is current rate, South America and the Caribbean regions could account for as much as 5% of global PV demand by 2016.

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