Brazil’s Ministry of Mines and Energy (MME) and the Energy Research Company (EPE) have published the second booklet of the Ten-Year Energy Expansion Plan (PDE) 2034. This document outlines strategic guidelines for distributed generation and battery storage behind the meter, highlighting how Brazil intends to advance its energy sector to accommodate future demands and technological advancements.
Key Aspects of the Second Booklet
Micro and Minigeneration Distributed (MMGD)
The booklet emphasizes the significant role that Micro and Minigeneration Distributed (MMGD) sources, particularly solar energy, play in Brazil’s energy expansion. By 2023, solar distributed generation had surpassed all other sources in terms of installed capacity, contributing to approximately 8.5% of national captive electricity consumption and nearly 20% in some regions.
Legal Framework
A critical development is the implementation of Law No. 14300/2022, which establishes the Legal Framework for Distributed Micro and Minigeneration. Key changes introduced by this law include:
- Reducing the limit for mini GD from 5 MW to 3 MW.
- Defining dispatchable sources such as hydro, biomass, cogeneration, and photovoltaic (PV) systems with batteries.
- Allowing hybrid systems and floating plants.
- Lowering the availability cost.
- Creating the Social Renewable Energy Program to support low-income consumers.
Compensation Rules
For existing and new generators, the compensation rules for energy injected into the grid will change gradually from 2023, leading to full compensation adjustments by 2029. These adjustments will impact investment flows, emphasizing the importance of strategic planning.
Battery Storage
The international and national contexts highlight the growing importance of battery storage systems. Internationally, lithium prices have seen fluctuations, impacting battery costs. In Brazil, the cost of turn-key battery systems is notably high due to significant tax burdens. However, future projections indicate a potential reduction in battery costs, which could enhance economic feasibility for various applications.
Economic Viability of Batteries
The booklet explores the viability of battery storage systems across different scenarios. For instance:
- Scenario I: Managing consumption with the White Tariff for low-voltage consumers.
- Scenario II: Peak demand management with the A4 Green Tariff for medium-voltage consumers.
- Scenario III: Increasing self-consumption of photovoltaic energy for low-voltage consumers with MMGD systems.
Future Projections
The reference scenario predicts significant growth in MMGD, with accumulated investments of R$ 116.6 billion and a cumulative installed capacity of 58.8 GW by 2034. The superior scenario projects even higher investments and capacity, while the inferior scenario outlines the minimum expected growth.
Challenges and Opportunities
The shift to distributed generation and the integration of battery storage systems present both challenges and opportunities. The regulatory environment will play a crucial role in shaping investment decisions. The law provides a framework, but uncertainties regarding the valuation of benefits and compensation mechanisms post-2029 need to be addressed to ensure stable growth and investment in the sector.
Conclusion
The Second Booklet of the Ten-Year Energy Expansion Plan 2034 outlines Brazil’s strategic direction in expanding its energy sector through distributed generation and battery storage. By addressing regulatory frameworks, economic viability, and future projections, the plan sets the stage for a sustainable and resilient energy future.