Brazil auction to initiate $1 B solar investment

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Brazil is going for its first national energy auction in solar power category, creating $1 billion in investment in solar power, reports Bloomberg.

CCEE, Brazil’s Electric Energy Trading Board plans to buy 2 gigawatts of renewable energy through this action, of which 500 megawatts will be generated from solar power.

This auction is expected to lift Brazil’s solar industry, which supplies less than one percent of the country’s electricity.

The main objective of this auction is to start developing the solar market in Brazil. Brazil needs solar-panel plants in the country and this is the best opportunity to be part of this sector’s production process, said, Thais Prandini, director, Thymos Energia.

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Brazil is facing worst drought in eight decades, reducing output from hydroelectric plants and hence country is planning to invest in renewable energy sources.

Solar developers applied to sell power from 400 power plants in the auction, with total capacity of 10.79 gigawatts.

Companies will race for 20-year contracts to sell power from projects that must go into operation by October 2017. Developers also registered 626 proposed wind farms.

The country’s energy regulator Aneel set a 262-real ($109) a megawatt-hour ceiling price for solar power.

The government sets a top price and developers bid down the rate at which they want to sell power. The lowest offers wins long-term contract to sell electricity, in Brazil’s power auctions.

Brazil is an underdeveloped market for solar power. In addition, high prices of solar panels have limited the photovoltaic industry in Brazil development. Solar panels aren’t produced domestically and imported panels are taxed 12 percent.

 

Sabeena Wahid

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