Shell, Gerdau sign JV for 260MWp solar PV project in Brazil

Share on facebook
Share on twitter
Share on linkedin
Share on reddit
Share on email
Shell said the project will operate under the self-production model, meaning Gerdau will pay lower tariffs on the power produced. Image: James Goldman

Energy major Shell and Brazilian steel company Gerdau have penned a 50-50 joint venture (JV) agreement for the development, construction and operation of a 260MWp solar PV project in the solar hotbed state of Minas Gerais.  

Slated to be built in 2023, depending on approval from regulatory authorities, the plant will supply half the power produced to Gerdau’s steel production units in Brazil, with the other half traded on the country’s growing free market via Shell Energy Brazil.

Brazil has a favourable ‘self-production’ model whereby projects that are built for self-consumption, rather than trading on markets, pay lower tariffs on the electricity produced. Companies are also able to outsource the construction and operation of projects to third parties.

Its growing free market has also seen more flexibility for companies to strike more lucrative, bilateral power purchase agreements (PPAs), circumventing the country’s national auctions.

Shell said the partnership with Gerdau “could enable the development of approximately one-third of the total capacity of the solar park” and that it would find other long-term customers to allocate the remaining power to.

“We are taking another important step in building a robust portfolio of renewable energies in Brazil, reinforcing the diversification of our businesses, always in line with our purpose of providing more energy and in an increasingly cleaner way,” said Shell’s director of renewables and energy solutions at Shell Brazil, Guilherme Perdigão.

Brazil’s solar sector has been booming of late, not least because of new net metering laws affecting distributed generation that come into effect in January 2023, causing the market to go into “overdrive”.

Utility-scale capacity additions are also on the rise, surpassing wind for the first time last year in a country that has typically had one of the lowest levelised cost of energy (LCOE) in the world for wind power.

PV Tech will be taking a much closer look at the Brazilian market in our upcoming edition of PV Tech Power through interviews with local experts, analysts, solar companies and banks. The 30th edition of PV Tech Power will be out later this month.

Read Next

May 25, 2022
Shell has tasked renewables monitoring and control firm Inaccess to optimise a 100MW solar-wind hybrid project in the Netherlands.
May 12, 2022
Energy investment platform CleanCapital has secured a US$200 million credit facility to support its pipeline of distributed solar and energy storage projects.
May 10, 2022
Cero Generation, a solar portfolio company of Macquarie’s Green Investment Group (GIG), has closed financing on its first corporate power purchase agreement (PPA)-enabled agrivoltaic project in Italy.
May 9, 2022
Solar developer Lightsource bp is setting up operations in France as it looks to reach a 1GW pipeline of large-scale PV projects in the country by 2026.
May 6, 2022
German renewables company BayWa r.e. will tender 10TWh of green electricity later this year, describing the move as a “turning point” for Europe’s power purchase agreement (PPA) market.
May 5, 2022
German conglomerate BayWa benefited from high demand for solar modules during the first quarter of 2022, with its revenues bolstered by the sale of an operational PV plant in the US.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
June 7, 2022
Leonardo Royal London City, London, UK
Solar Media Events
June 14, 2022
Napa, USA
Solar Media Events
June 22, 2022
Sheraton Austin Hotel at the Capitol, Austin, Texas