Spain and Brazil the world’s ‘solar investment hotspots’ but eyes on Vietnam


The proliferation of solar projects selling unsubsidized clean energy on wholesale markets in Spain has seen the nation singled out as a “global solar power outperformer” in a study published by analysts Fitch Solutions Macro Research.

Brazil earns similar billing, as a global leader in low-cost solar power production, but Fitch analysts also tipped Vietnam as a ‘solar one to watch’ as they believe this year’s remarkable burst of solar activity was no one-off.

The Solar Power Investment Hotspots report singled out Spain for its leadership on grid parity projects, Brazil for the low prices achieved in recent solar auctions and Vietnam for its impressive generation capacity growth from almost a standing start.


Fitch recently upgraded its forecast for Spanish solar, noting productive joint efforts by the government and private sector. The analysts expect a rising number of private power purchase agreements in the Spanish market, as well as grid parity projects selling electricity directly on the spot market. Fitch expects Spain’s solar capacity to grow by 11.4 GW between this year and 2028.

However, the analysts highlighted Spain’s recent political gridlock as a potential risk factor. “Forming a working government coalition will be necessary to enabling Spain to reform issues facing the sector such as permitting issues, as well as launching new auctions,” stated the report.

Spain wants 74% of its electricity to come from renewables by 2030, and to be carbon neutral by 2050. According to Fitch, the country will need to install a further 57 GW of renewables between 2021 and 2030 to hit that first target, meaning annual capacity auctions of 3 GW or more will be required.

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The Fitch report picked up on record low solar electricity prices achieved in Brazil’s recent auctions as drivers for future growth. The analysts noted, the lowest prices achieved were for projects planning to sell part of their output on the spot market to offset the low contract prices agreed.

Fitch expects the Brazilian government to continue to capitalize on low prices for solar with further auctions, and predicts rising retail electricity prices – alongside falling PV costs – will boost the uptake of distributed, small scale solar generation. The analysts forecast the country’s solar capacity will increase from 3.3 GW this year to around 12 GW in 2028.


This year’s surprise gigawatt market, Fitch expects Vietnam to continue its impressive solar growth into the next decade, noting high solar irradiation levels and strong policy support. The government is targeting 12 GW of solar capacity by 2030 and is offering incentives to attract foreign investors. Fitch expects such policy support will make Vietnam an attractive prospect, particularly given the auction procurement regime which has driven down prices in Brazil and other regions.

“While a proposed 20% cut to the FIT [feed-in tariff] for ground-mounted and floating solar capacity in September could curb investor interest somewhat,” noted the report, “we believe that the new FITs of $70.9 and $76.9/MWh for the two solar sub-segments … will remain high enough to attract investors.”

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