The report covers in detail the market supply demand dynamics, supplier landscape, pricing analysis and procurement best practices across the industries for Brazil Electricity Market
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Brazil Electricity market report transcript
Brazil Electricity Market Analysis and Regional Market Outlook
Power Generation Capacity
- The capacity of electricity generation is expected to grow at a CAGR of 3.06 percent in the next three years, with highest growth in the renewable energy sector
- Hydro generation capacity has growth at 1.4 percent CAGR, with an expected rise in installed capacity of about 4,139 MW by December 2017
Thermal power growth is expected to have 3.2 percent CAGR in the next three years, especially in natural gas-powered plants with low fossil fuel prices adding to the cost attractiveness of thermal power plants. Mauá 3 Thermal Power Plant 590 MW under construction in the city of Manaus adds to thermal installed capacity on 2017
Nuclear and biomass power is growing at 4.26 and 4.1 percent CAGR, respectively, as a part of Brazil's aim to have a higher share of renewable power connected to national grid. Enel Green Power has added four PV projects for a total capacity of 807 MW by 2018
Enel added 172 MW Morro do Chapéu Sul wind facility, which is located at Brazil’s North-eastern state of Bahia
Electricity Supply and Demand
- With the North electrical subsystem having the largest growth rate, due to large plants, load expansion and the interconnection of the Macapá and Boavista regions, the growth is considered to increase in the next three years
- Electricity consumption in the grid is expected to grow at a CAGR of 2 percent for the two years, reaching 580 TWh in 2024.
- Transmission losses are estimated to be at 16.7 percent, which is much higher than the global average of 8 percent.
Industry Structure and Outlook
- The overall share of hydro energy in fuel mix is expected to decline by 4 – 5 percent by 2019, as Brazil is aiming to balance the lopsided fuel mix of the country
- The thermal power capacity expansion is expected to evolve mainly from natural gas fuelled power plants; however, due to faster growth of renewables, the overall thermal power share is expected to remain the same
- Nuclear expansion occurs via Angra 3, and its operation is expected to start in January 2019 and will represent an expansion of 70 percent of the current nuclear power capacity
- Renewable energy share is expected to increase at an average growth rate of 5 – 6 percent annually, especially because of the strong expansion of wind and biomass power capacity
Brazil –Renewable Energy Outlook
- Renewable energy capacity, including hydro, is expected to grow by 3–5 percent in between by 2020. Wind and solar would be the major growth drivers.
- Brazil renewable energy has witnessed a growth rate of 6.49 CAGR between 2012 and 2017. The installed capacity of renewable energy is expected to grow to 140 GW by 2020, from 126 GW in 2017
- The renewable energy growth is expected to come mainly from wind and solar
Brazil –Green Energy Regulations and Incentives
Renewable Energy in Brazil is governed by ANEEL. Brazil does not employ quotas and feed in tariffs unlike many other countries. Further there is no renewable energy certificates market in the country.
Capacity Addition and Utilization Outlook
- Hydro generation capacity of 12.7 GW is expected to be added by 2024 as the government is aiming to reduce its dependency on hydro power share
- Thermal power growth capacity of 6.5 GW is expected to be added by 2024, especially in the natural gas powered plants
- Wind power growth capacity of 17.3 GW is expected to be added by 2024 because of high wind power potential in Brazil coupled with the government's commitment to increase renewable share in the fuel mix
- The Brazilian Association of Photovoltaic Solar Energy (Absolar) projects that the country will end 2018 with 2.5 GW of installed solar power generating capacity, a 115 percent surge from the 1.15 GW in end-2017. Enel adds 1.13 GW of renewable capacity where new capacity comes from solar in North America and onshore wind in Iberia and South America
- Enel Green Power has added four PV projects for a total capacity of 807 MW by 2018 will also contribute in lowering the electricity price Brazil.
Electricity Suppliers Market Landscape
- In all, 75 electricity generating companies are operating in the Brazil power market as of 2016
- Large government-controlled companies dominate the sector with four public companies Eletrobras, Cemig, CESP and Copel, having 47.3 percent share
- Private sector has increased rapidly in the last 5 years with a total share of 52.7 percent, and Engie Brasil being the largest private player with a share 5.4 percent
- The top 11 electricity generating companies generated 60 percent of the total power in 2018
- Government controlled firm Eletrobras is the largest producer with 27.3 percent share
- Private firms have increased the share of electricity generation, with the top player being Engie
- In the transmission market, Eletrobras Group accounts for approximately 50 percent of the share