| Brazil’s energy transition
prevent evaporation and reducing watering requirements. Ground-mounted solar is also compatible with smaller, free-ranging livestock such as chickens and sheep.
The winds of change
Historically, the abundance of hydroelectric power in Brazil has ensured its energy mix has been inherently low carbon. However, there are growing problems with aging hydroelectric infrastructure and in recent years generation has been erratic because of the effect of drought on river levels.
The demise of hydro is fuelling the growth of solar and other more sustainable forms of renewable energy. Indeed, over the past decade, Brazil’s wind power output has grown by 20x to now supply almost 10% of the country’s electricity with 19 GW of installed capacity. As well as enjoying high levels of insolation, which benefit solar generation, Brazil is also very windy. During 2020 the capacity factor for wind was over 40% compared to a global average of 35%. And with 7400 km of Atlantic shoreline, we see a significant opportunity for Brazil’s offshore wind sector.
Alongside solar, wind energy has a promising future in Brazil and we expect to see continued strong growth throughout 2022, with the
emergence of new opportunities for floating offshore wind technology.
The hydrogen opportunity With an abundance of renewable energy, Brazil is well-placed to profit from the hydrogen economy. During 2021, the north eastern Brazilian state of Ceará announced plans to build a 600 000 tons per year green hydrogen plant, which would make it the world’s largest. As well as helping to decarbonise Brazil’s industrial economy, Ceará intends to export the hydrogen it produces. Hydrogen can also play its part in the energy transition by providing energy storage for microgrids, ie, hybrid energy systems comprising renewable generation and storage, which provide access to electricity 24/7. Microgrids are self-sufficient local energy networks that can serve a neighbourhood community, campus or business. They can operate alongside the existing energy grid, or completely independently of it. Today, batteries provide the most straightforward way to store energy, but hydrogen is also becoming more viable for energy storage as the price of the specialist equipment falls.
We expect to see more significant Brazilian hydrogen infrastructure projects announced in 2022 serving a wide variety of applications.
A green economic bounce Despite the government’s lamentable environmental track record, Brazil is becoming increasingly well positioned to benefit from investment in its green economy throughout 2022.
The most recent legislative proposals will bring legal security both to contracts and to consumers, who will have their rights guaranteed and respected.
The government has also scrapped import duties on foreign manufactured solar equipment – a move designed to encourage inward investment.
Developing reliable energy infrastructure is essential if the country is to sustain a strong economy. New policies that support green investment will create jobs in clean energy and boost the wider economy by providing Brazil’s businesses with reliable low-carbon power. We will see foreign investors continue to back Brazil’s green resurgence during 2022. Taking urgent, credible action to halt deforestation and environmental destruction could open the floodgates to inward investment.
Lisarb Energy is one of Brazil’s fastest growing solar and renewable energy developers
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