Brazil to hold next A-4 auction on June 27, solar likely to be included

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Brazil’s Ministry of Energy and Mines (MEM) has published a new schedule for energy auctions up to the end of 2021. Nine procurements will be held: six for new large-scale power projects and three for existing plants.

For the six “new energy” auctions – which could include solar – the MEM has scheduled two auctions per year: an A-4 auction for power supply to begin four years after the exercise, and a six-year A-6 auction. The A-4 auctions will be held on June 27; April 23 next year; and April 29, 2021. The A-6 auction dates are September 26; September 24 next year; and September 30, 2021.

The government has not said which energy sources will be entitled to participate in the auctions but its decree for June’s A-4 auction should be published in the coming weeks, according to Rodrigo Sauaia, president of Brazilian solar association ABSOLAR. He told pv magazine the association was confident this year PV technology will be admitted to both “new energy” auctions.

Excluded

Last year, solar was eligible only for the A-4 procurement, with the government stating a six-year period for project commissioning was too long given the rapidly falling cost of PV project development.

In the A-4 auction held in early April last year, Brazilian energy agency Empresa de Pesquisa Energetica and the Electric Energy Trading Chamber allocated around 806.6 MW of PV – almost 80% of the total assigned capacity. The final average price for solar was BRL118/MWh ($35.2 at the time, now $30.79). The auction was open to new large-scale hydroelectric, wind, solar, thermoelectric and biomass plants. Selected projects will have to start delivering power on January 1, 2021.

According to a recent report from Brazilian consultancy Greener, of the 4,920.7 MW of solar capacity Brazil’s government contracted through five energy auctions between 2014 and last year, approximately 2,193 MW are connected to the grid. The most successful tendering exercise was the first, held in 2015, which saw all the contracted capacity in operation, testing or under construction. A second auction held the same year resulted in 97% of the contracted capacity reaching the same stage.