Brazil’s solar industry is making a big bet

Share on facebook
Share on twitter
Share on linkedin
Share on reddit
Share on email

The solar industry is making a big push for Brazil to be the next big market but it’s still not clear if they can pull it off. In early 2015 the company I work for, Vaisala, opened a local office in Brazil to support the growing renewable energy market with measurement equipment and consulting services crucial for accurate wind and solar energy assessment and forecasting. At the end of August I travelled to Brazil to see first hand how the market is developing and to meet local developers trying to get their projects off the ground. I also had the opportunity to attend Intersolar South America, which included many of the international players as well.

Brazil PV. The country has set itself hugely ambitious deployment targets over the next two years. Image: MPX/Ismar Ingber

The market is moving fast and shows a lot of promise, but does face some big macroeconomic challenges. In the last two years the solar industry in Brazil has gone from almost no installations to 2,000MW of PV projects that have successfully navigated the Brazil energy auction process. The process gives a company the ability to connect to the grid, a secure power purchase agreement and access to state-backed financing. This last item is critical at this time due to the effects of inflation on the cost of debt.

The last round of auctions saw over 20GW of solar projects bidding to be included from a variety of local and international players. For colour, the established wind industry only put forward 18GW of projects for consideration in the same auction – a fairly modest number given their much larger average size. Vaisala’s role in the auctions is supporting our clients with the solar and wind energy estimates that they must submit with their projects and we can confirm from our own experience a recent and significant uptick in the number of solar submittals.

Two-thirds of the projects registered for auction were located in the northeast portion of the country. The Vaisala solar resource dataset suggests this area has an available solar resource that rivals the Southwest United States. This also happens to be where many wind farms are located and local developers are familiar with building in the area. In fact many of the companies I spoke to while in Brazil were looking into hybrid solar and wind facilities in the near future, which I think is an exciting area of development.

Brazil has huge solar potential. Image: Vaisala.

The first projects, awarded in 2014, need to be online by the end of 2017 and the projects awarded on 7 September need to be online by the end of 2018. The sites and equipment have been chosen, financing sourced and a lot of the pre-construction work is completed. However, delays are happening in sourcing said equipment. In a country with an established supply chain and work force these deadlines would be ambitious but feasible. In Brazil neither exists at this time.

Local content rules make it difficult for developers to import panels and receive state financing and increasing inflation makes it difficult to do so at a competitive price.  On 1 September the first local solar panel manufacturer opened, Globo Brazil, but with a 180MW annual capacity it clearly won’t be the only player in the market. Some auction winners, like Enel, have said they will source a mix of local and imported content for their winning projects.

SunEdison, with its local arm, Renova, and Canadian Solar were both big winners in the auctions and both made announcements at Intersolar South America that they would be building local manufacturing facilities. It feels ambitious to say the least to build a manufacturing facility and have equipment from said facility operational between now and 2017, but if anyone can do it these companies can.

Who will be doing the installation is a different question. At one of the educational sessions at Intersolar South America it was suggested that the industry would need 6,000 trained solar workers just to install the projects awarded in 2014 in time and more will be needed when you include the projects just awarded. There are no shortages of smart people looking for work locally, but there is certainly a shortage of trainers as there is with any new industry entering a market. Most of the companies I spoke with intended to bring in experienced employees from outside to train a local workforce.

The Brazil market has a lot going for it: knowledgeable project developers, a politically favourable environment, available financing and a great resource. The locals have some cynicism when it comes to politics, but they are as enthusiastic about the solar market as anyone I’ve encountered. I believe they can create the conditions for success around equipment availability and a trained workforce, but it is going to come down to the wire on whether they can do it in time to meet their aggressive project deadlines.

I imagine this sounds quite familiar to those trying to beat the looming investment tax credit deadline in the United States or those who have experienced the same in various European countries over the years. Given the successful track record against similar circumstances in other markets, I imagine we’ll be looking back three years from now and wondering what all the worry was about. For those of you thinking about entering the Brazilian market, I say, do it!

19 August 2021
The utility-scale PV market is poised for exponential growth and yet the industry still has many fundamental opportunities to improve on standards and best practice. Tracker shade loss has been one of those topics that deserve more attention, but has been typically handled by derate factors rather than trying to accurately forecast the loss over the life of the system. Join Nextracker’s subject matter experts, Aron Dobos and Neelesh Umachandran, and Rounak Kharait, director of solar energy assessments at DNV, for a webinar about why shade modeling matters and recommendations on what the solar industry should do about it.
25 August 2021
Energy Next is a new industry exhibition focusing on the latest renewable energy and energy efficiency technology, which will be held for the first time in 2021 in Sydney, Australia alongside the Clean Energy Council’s Australian Clean Energy Summit, the peak gathering of leaders driving Australia's energy transformation. Organised by the same people behind Australia’s largest clean energy event, All-Energy Australia, Energy Next will give visitors two days of access to key suppliers in the industry, free-to-attend professional development and industry workshops, and networking opportunities to better understand clean energy issues and solutions and learn about the latest developments in this transformational, dynamic sector.
25 August 2021
The Intersolar Summit Brasil Nordeste takes place in Fortaleza, Brazil. It addresses leading local and international experts on solar power and renewable energy in the region. The Summit’s mission is to provide in-depth education, enable high-quality networking opportunities, expand the use of PV technologies at regional and national level and strengthen the local PV industry. The Intersolar Summit Brasil Nordeste is organized by Intersolar South America - Latin America’s largest exhibition and conference for the solar industry: Solar Promotion International GmbH, Pforzheim, Freiburg Management and Marketing International GmbH (FMMI) and Aranda Eventos & Congressos Ltda, São Paulo as co-organizer.
25 August 2021
Join us to hear directly from the CTOs and heads-of-research from the top-20 cell/wafer producers to the PV industry today. The event will focus on predicting the key metrics underpinning the next big shift to n-type with answers to the key questions: When will the transition to n-type happen? Which companies will be first to 10 GW capacity and production? Who will be the key equipment suppliers for the new production lines? Which n-type process flow/architecture will emerge as the front-runner? What will polysilicon purity and wafer thickness levels look like for optimized n-type manufacturing? What will the upstream poly/wafer supply-chain look like in 5 years from now?
26 August 2021
In this webinar, JA Solar will present its product portfolio based on the latest technologies to improve your PV projects, ensuring maximum reliability and performance. During the webinar we will receive insight from JA Solar about its solar technology roadmap and how the manufacturer is providing customers with innovative solutions to suit their needs, while we will also analyse how to determine the best product solution for each solar project.
6 September 2021
The 38th European Photovoltaic Solar Energy Conference and Exhibition will be held online from 6 - 10 September 2021, allowing PV experts from all around the globe to participate with just one click! The EU PVSEC is the world's leading forum for PV Research and Development and the biggest Conference on PV Solar Energy worldwide. That is why PV experts from all around the globe are keen on gathering together each year to be part of this specialist’s event, to present and discuss the latest developments in Photovoltaics, to network and to conduct business.

Read Next

PV Tech Premium
July 30, 2021
Not only will solar be the dominant source of new power generation in Europe by 2025, cementing its position as the third largest market for solar globally, but the continent has placed the asset class at the very heart of its COVID-19 recovery strategy. As part of a week-long special report on PV Tech Premium, Liam Stoker, Edith Hancock and Jules Scully explore the drivers for solar in Europe, the key markets and the challenges that remain.
July 30, 2021
First Solar has unveiled plans to construct a 3.3GWdc module assembly facility in India, bolstering its manufacturing footprint outside of the US.
July 30, 2021
Anglo-Australian mining company BHP, in partnership with Canada’s TransAlta Renewables, is to build two solar farms and a battery storage system to help power its Mt Keith and Leinster nickel mines in Western Australia
July 30, 2021
German energy giant RWE has upgraded its earnings forecast for 2021 after “exceptionally positive” earnings trend
July 29, 2021
Tracker and racking provider Arctech has delivered SkySmart II tracking system to a 575MW agriculture-sharing solar project located in Nangong City, Hebei Province, China.
July 29, 2021
Unigreen Energy, owned by Hevel majority shareholder Ream Management LLC, has broken ground on a wafer and cell manufacturing plant that will produce 1.3GW of silicon n-type monocrystalline ingots and wafers as well as 1GW of heterojunction technology (HJT) solar cells.

Subscribe to Newsletter

Upcoming Events

Upcoming Webinars
August 19, 2021
At 9am (PT) | 6pm (CEST)
Solar Media Events
August 25, 2021
Solar Media Events
October 6, 2021
Solar Media Events
October 19, 2021