Brazil looking to ‘reorganise’ and diversify from solar auctions

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Minister of Mines and Energy, Fernando Coelho Filho addressed the audience at Brazil Solar Power. Credit: MME

Brazil will continue to procure solar energy through auctions, but is looking to find new ways of handing out capacity, according to the Minister of Mines and Energy, Fernando Coelho Filho.

The minister said the solar PV segment is critical to the Brazilian energy matrix and new ways to encourage the sector must be pursued so that the thread does not become dependent on auctions alone.

Coelho Filho added that while auctions will continue, he will also be looking at reorganisation and new ways to hire solar capacity.

He said: “If we do not create a more competitive, more favourable environment, the resource is more profitable [in other countries] and that's not what we want right now.”

Discussing the upcoming energy auction, which has now been delayed with no set date, Coelho Filho said: “Before we hire new energy, there are some problems we have to address as a Ministry, and the diagnosis is almost ready. Some measures are already being taken, especially on the over-contracting. We cannot afford to bet only on revenue from the auction.”

The news comes in the wake of unrest over the solar projects awarded in Brazil’s first auction in 2014, as the developers have asked for more time to complete the projects as a result of the Brazilian currency sliding since that time. However, the ministry recently rejected these pleas from developers.

On another note, Coelho Filho cited the North of Brazil as a particular region for expansion of distributed generation solar systems, which can be supported by the ProGD scheme, which was launched by the ministry in conjunction with Absolar, Brazil’s solar energy association. This is particularly pertinent given the very high cost of traditional energy generation in Northern Brazil from the utility Eletrobras.

Finally Coelho Filho said the ministry is looking at an energy policy that would give tax equality to renewable generation as well as incentives to produce equipment domestically.

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