Brazil’s Bolsonaro taps green bonds to deliver 8GW of new solar

Image credit: Família Bolsonaro / Flickr

Brazil is to turn to green finance to try and deliver a multi-gigawatt boost to renewables, an industry grappling with the COVID-19 chaos that has forced to shelve green energy tenders.

In recent days, president Jair Bolsonaro signed a new decree laying the foundations of a green bond programme, meant to channel funding towards solar PV, wind, small hydro installations and energy-from-waste facilities.

The so-called green debentures will see debt raised (see below) towards these industries, amid hopes by Brazil’s government of delivering an 8GW fleet of new solar nationwide, coupled with also-significant portfolios of new wind (25GW) and small hydro power (3GW).

According to estimates from Brazil’s Energy Ministry, the three renewable segments could bring Brazil a combined investment of 170 billion Brazilian Real (US$34 billion) by 2029. Brazil’s regions would see “thousands of jobs” created through such green energy boom, the Ministry said.

The green finance move looks set to further bolster Brazil’s solar fortunes. Pre-COVID, the country was an often-cited market to watch in Latin America, with downstream and mainstream players alike announcing expansion plans in recent months.

As documented by PV Tech, the pandemic has indefinitely paralysed Brazil’s A-4 and A-6 state energy auctions, closing an avenue that sparked gigawatts’ worth of solar bids last year and some of the lowest solar tariffs seen in the world.

COVID-19 controversies for solar-keen Bolsonaro

Brazil’s renewable campaign comes as the country fights one of the worst COVID-19 outbreaks worldwide, with 772,416 reported cases only surpassed by the two-million-plus reported cases in the US.

Already a controversial figure pre-pandemic, president Bolsonaro has come under heavy criticism over his handling of the health emergency. Just this week, the head of state was ordered by the courts to resume publishing COVID-19 data, after public access was curtailed.

Much like in Europe and the US, the pandemic has coincided with a rise in solar generation, with 53.3% year-on-year jumps reported in early April. Led by association ABSOLAR, the industry has asked to be treated as a strategic recovery pillar, amid calls for a new social tariff for rooftop PV.

Bolsonaro himself has long championed solar despite his many green controversies, a support linked by commentators to the government’s view of PV as an efficient energy source. In early January, the president personally intervened to block a solar tax, defying his own energy regulators.

Tags: covid-19, coronavirus, brazil, south america, latin america, esslatam, solar, solar pv, green bonds, solar finance, green finance, pv power plants