Brazil to expand utility-scale electricity grid by 22 GW of renewable energy in two years

This expansion increased Brazil’s overall generating capacity to almost 204 GW, with renewables accounting for 171.8 GW, according to a report titled “Brazil Operational Renewables.” Key contributors to this growth are the onshore wind and centralized photovoltaics sectors, which together added more than 18.5 GW of new capacity.

The states of Bahia, Rio Grande do Norte and Minas Gerais led the way, each adding more than 3 GW of new capacity, mostly from wind and solar projects, according to the report. The northeastern states of Piauí and Pernambuco also contributed, adding a combined 3.7 GW from wind and solar sources, according to the report.

The report sheds light on Brazil’s long-standing energy diversification policies that have facilitated the development of the energy sector. The award of multiple long-term power purchase agreements (PPAs) in both the Regulated Contracting Environment (ACR) and the Free Contracting Environment (ACL) further stimulated this expansion.

“The onshore wind and photovoltaic industry has benefited greatly from the country’s long-standing energy diversification policy, which aims to redistribute some of the traditional role of the hydropower sector, for example by subsidizing the costs associated with installing onshore wind farms and photovoltaic parks in the country,” the report said.

Despite advances in renewable energy, hydropower remains the dominant force in Brazil’s energy grid. However, according to the report, the country continues to rely on conventional energy sources to ensure stability during periods of water scarcity and peak demand.

The EIC report also pointed to ongoing regulatory work, such as the National Low Carbon Hydrogen Policy, and potential future investments in offshore wind projects that could stimulate further growth and innovation in the Brazilian renewable energy sector.

“The rapid expansion of renewable energy capacity in Brazil demonstrates the country’s commitment to diversifying its energy mix and reducing its dependence on hydropower,” said Lucas Ramos, EIC O&G energy analyst, Americas. “Our findings show that strategic investments and supportive policies have played a key role in accelerating the growth of the renewable energy sector.”

Additional information:

Energy Industry Council (EIC)