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Storage will be key to modernizing Brazil’s electricity sector

Source：www.ess-news.com

Brazil’s energy storage sector must attract R47 billion ($7 billion) in investments by 2030, according to the Brazilian Energy Storage Solutions Association (Absae). Stakeholders are in the process of creating a regulatory framework for energy storage.

 

The Brazilian energy storage market will be one of the main pillars of the national plan to update the country’s electricity sector. This was one of the insights shared by Absae during the launch of the “First Panorama of Storage in Brazil”, held last week, in the capital of São Paulo. During the presentation, Absae shared the vision that storage must become a protagonist in the electricity sector and attract up to R$ 47 billion in investments by 2030.

 

Energy storage, especially through battery systems, has been called the “Swiss Army Knife” of the electricity sector. According to Absae advisor and Vice President of New Business and Innovation of energy storage solutions company UCB Power, Marcelo Rodrigues, these systems offer unprecedented versatility by offering integration of renewables, solutions for energy flow reversing, transmission and distribution support, and greater independence to the end consumer.

 

Absae President Markus Vlasits also emphasized the strategic role of storage. “Storage is happening and is one of the protagonists of the electricity sector. We forecast investment potential of up to R$ 47 billion by 2030. This means modernization, technological innovation and job creation, key elements to make the sector more flexible and resilient.”

 

Auctions to maximize investment

 

In addition to technical and political challenges, storage emerges as an anchor technology for the decarbonization of the Amazon electric matrix, which still relies largely on diesel and natural gas. It is expected that about R$ 14 billion will be investments in off-grid solutions capable of transforming isolated communities. In addition, Absae bets that R$ 16 billion can be injected into front-of-the-meter solutions, and R$ 14 billion in behind-the-meter systems that increase energy efficiency and the integration of renewables throughout the country, reducing the costs of electric energy.

 

The Capacity Reserve Auctions, planned to start in June 2025, promise to boost investments for the adoption of storage, with the possibility of procuring 2 GW per year. For Rodrigues, these auctions are the key to putting Brazil among global leaders in the use of storage systems.

 

“The auctions will boost the market, since the industry is already very motivated. Now our hard work will be with the legislature. I believe that the storage market will remain relevant, after all, the modernization and solution for the energy matrix in Brazil pass through the batteries”, said Rodrigues.

 

Regulatory and tax challenges

 

The path to market growth is hindered by regulatory and fiscal barriers. The absence of a specific regulatory framework for energy storage is one of the main barriers, generating uncertainties about tariffs, grant schemes, and revenue sources. However, progress is being made, with the inclusion of the storage agenda at the next meeting of the National Electric Energy Agency (Aneel), on December 10. Aneel was founded only one year and three months ago. The first official standard on storage is expected to be published in 2025.

 

In the tax sphere, the 55% to 70% charge on batteries – currently treated as luxury products – is another obstacle. Vlasits advocated a tax reclassification. “Battery is not a load, no energy source, like in Chile. “It will likely be treated as a sui generis category, as it already occurs in other countries. Tax equality is essential to enable new projects.”

 

2025 and beyond

 

The launch of the Panorama of Storage in Brazil marked a breakthrough in technical discussions and symbolized the beginning of a new era for the Brazilian electricity sector. With its eyes on the regulatory framework, the storage market has the potential to be one of the great drivers of the national energy transition.

 

With the creation of adequate public policies, the impact is not limited to clean energy. “This is an investment in jobs, innovation and, above all, in the country’s energy security,” concluded Vlasits.


By Alessandra Neris
Dec 09, 2024

 

 

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