Only 813MW of PV through to second round of Brazil A-3 auction

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A total of 31 PV projects with a generation capacity of 813MW have made it to the second round of bidding under Brazil’s ‘A-3’ energy action, according to the Brazilian government’s Energy Research Company (EPE).

In September, 2.7GW of PV projects were being considered for November's A-3 auction – the first government energy tender auction in Brazil to allow solar project developers to bid. 

The 31 projects still in the running for the A-3 auction are split into 12 projects in the Bahia region amounting to 309MW, four projects in Minas Gerias totalling 115MW, nine in Paraiba totalling 253MW, four projects in Piauí accounting for 91MW and two projects in Rio Grande do Norte with a capacity of 45MW. 

Overall 429 projects are to participate in the A-3 auction, with a total of 10.46GW.

A ceiling price of BRL126/MWh (US$54) has been set for all power sources, which industry observers had said could prove be too low for solar projects in Brazil to be financially viable and will prevent solar projects being selected.

Last week a consortium of Brazilian energy companies called for solar-only auctions, claiming a reasonable price to offer PV projects would be between BRL190 (US$83) to BRL200 (US$87) per megawatt hour.

Leonardo Calabró, executive vice president of COGEN, part of the consortium, said last week that as solar is not yet competitive with wind and other energy sources in Brazil, it was unfair for solar to compete in the A-3 and A-5 energy auctions. 

The forthcoming A-5 auction (with a five-year development deadline, rather than the three years permitted under the A-3 auction), accepted 152 preliminary PV bids or 3,601MW, with PV projects second in popularity after wind. The A-5 auction has set an even lower rate of BRL122 (US$52.0) per MWh.

The president of EPE, Mauricio Tolmasquim said on the set price: “Although solar energy is not yet competitive in terms of the cost of the other sources, especially with wind, its presence at the auction next week demonstrates the concrete interest of entrepreneurs to invest in this source. Beyond that the registered projects allow EPE to plan for the entry of solar energy into the Brazilian energy matrix.”

The A-3 auction is the first government energy tender auction to include solar projects. Successful projects must generate electricity by 1 May 2016.

The final auction is being held on 18 November at the headquarters of commercialisation Chamber (CCEE).

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