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Brazil to become major global solar market by 2026, says SolarPower Europe

Brazil to become major global solar market by 2026, says SolarPower Europe

SolarPower Europe launched its “Global Market Outlook” report at Intersolar Europe this week in Munich. The world installed a record 167.8 GW of solar in 2021, passing the 1 TW milestone and giving rise to a new international solar star: Brazil. 

SolarPower Europe’s “Global Market Outlook for Solar Power 2022-26” report, launched in Munich during the Intersolar Solar event, paints a sunny picture for solar throughout the world. This year’s report also features a special focus on the Latin American market, written in collaboration with the Global Solar Council and the Brazilian solar PV association, ABSOLAR.  

In 2021, Latin America’s PV capacity additions increased by 44%, totaling 9.6 GW, with cumulative capacity 0f more than 30 GW. The region’s solar market has grown more than 40 times since 2015. Projections suggest that by 2026, it could grow by up to 30.8 GW per year. In this incredible success story, one country emerges as a rising star: Brazil.  

Latin America’s solar leader is set to become one of the top five global markets in the next five years, reaching 54 GW total solar capacity by 2026, according to SolarPower Europe. pv magazine recently sat down with Dr. Rodrigo Lopes Suaia, the CEO of ABSOLAR, to discuss the report and Brazil’s place in the global solar market. 

As of April 2022, Brazil had surpassed 15 GW of total installed solar, with more than 5 GW added in 2021 alone. Distributed-generation systems account for 10 GW of installed capacity, and large-scale solar PV power plants for 5 GW. Distributed generation registered record growth in 2021, but that may well be surpassed in 2022.  

The passage of a long-awaited distributed generation law explains the growth surge, Suaia told pv magazine. The law ensures that all distributed solar systems in operation and all new requests performed until 2023 will be eligible for full net metering until the end of 2045. Connection requests performed from 2023 on will be subject to a new net-metering regime, which gradually introduces grid fees for the electricity injected into the grid.  

According to Suaia, these fees will not lead to a loss of interest in solar.

“There is no risk of market collapse. We believe this solution will help the system continue to grow, without annoying utility companies,” Suaia said. “Electricity tariffs increased by 20% to 25% in the past year, overcoming an inflation rate of 10%. These payments will remain competitive for end-consumers to choose solar.”

The country’s other main market segment, centralized generation, also saw a record number of new projects in 2021, with most of them targeting bilateral power purchase agreements in Brazil’s so-called free electricity market. Government-regulated market auctions used to be the rule in Brazil, but a weakened economy prompted the federal government to scale back the size of auctions in 2021. Solar’s cost competitiveness has incentivized large consumers such as shopping malls to enter into bilateral agreements with generation companies, in order to own or lease their large-scale solar PV plants and reduce their electricity bills, Suaia explained.  

Energy storage is also expected to grow in Brazil. However, it still faces high taxes, a lack of regulatory frameworks, and insufficient incentive schemes for end users.

“We also faced these issues with solar. We have learnt a lot and are using that experience to inform the rapid growth of storage in Brazil,” said Suaia.

ABSOLAR has set up a working group to propose a roadmap for storage, in partnership with two consulting firms. Their work will focus on regulation and legislation, taxation, access to financing, and technical norms.

“The future is bright,” concluded Suaia. 

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