Brazil: Ceiling price for solar in upcoming auction set at $96/MWh

Brazil’s energy regulator, ANEEL has published the terms for its upcoming power auction A-4/2018, which will be held on April 4, and will include solar, among other energy sources.

ANEEL has established a maximum price of 312 BRL (US$96.5)/MWh for solar projects – a price which is slightly lower than that of 329 BRL, which had been established for the tender of the same kind, held last December.

As for the other technologies competing in the auction, ANEEL has established a maximum price of 255 BRL/MWh for wind power, 329 BRL/MWh for biomass, and 291 BRL/MWh for hydroelectric projects.

By way of comparison, however, it must be remembered that the final average price for solar energy in the December auction was 145.78 BRL (around $45)/MWh, which turned out to be a price lower than half of the maximum price, which had been set for the tender.

The Brazilian government agency, Empresa de Pesquisa Energetica (EPE), revealed in January that 1,672 energy projects with a combined capacity of 48.71 GW were presented for the prequalification process of April A-4 auction.

Of these projects, according to the agency, 620 are solar power plants with a combined capacity of 20 GW, while another 931 projects totaling 26.1 GW comprise wind power projects.

In the auction held in December, Brazil’s Ministry of Energy and Mines (MME) allocated around 574 MW (AC) of PV power. In this auction, the pre-selected projects reached a combined capacity of around 18 GW.

The April A-4 auction will be the fifth power auction to be held at a national level, including large-scale solar PV. In the four auctions held by EPE between 2014 and 2017, about 3.5 GW of large-scale PV capacity was assigned.