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Here comes the sun

Here comes the sun. Brazilian American Chamber of Commerce New York , November 30th 2010. Rafael Kelman rafael@psr-inc.com. Renewable energy in Brazil. 85% of Brazil’s power supply (104 thousand MW of installed capacity) comes from renewable sources

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Here comes the sun

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  1. Here comes the sun Brazilian American Chamber of Commerce New York, November 30th 2010 Rafael Kelmanrafael@psr-inc.com

  2. Renewable energy in Brazil • 85% of Brazil’s power supply (104 thousand MW of installed capacity) comes from renewable sources • Hydropower has been – and still is – the most important energy source • More recently, biomass and wind have become fully competitive • Contracted in competitive auctions • No subsidies

  3. What about solar?

  4. Solar PV production in Rio (http://www.pvwatts.org/) Watts of electricity production for installed kW Annual production of 1352 kWh per kW of installed capacity (capacity factor of 15%) Production during winter is only 20% smaller than summer. Belo Monte hydro plant produces 15 times less energy in September (dry period) than April (wet period).

  5. Some recent solar initiatives in Brazil • MPX (Eike Batista) announced a 1 MW of thermal power project to be developed in the state of Ceará ($6 million) • Spanish Solaria announced a joint venture with Cemig (Minas Gerais) for a 3 MW grid-connected solar plant in Brazil • WHAT ABOUT COST?

  6. PV panel cost Inverter cost is $0,33/Watt

  7. Solar PV costs in Rio

  8. Can solar compete on the generation side in Brazil? Hydro generation cost: 120 R$/MWh NO Solar cost: 433 R$/MWh

  9. Can solar compete on the end-user side? Solar cost: 433 R$/MWh End-user electricity bill: 485 R$/MWh YES

  10. Why? • Although generation costs are cheap (120 R$/MWh), transmission + distribution + taxes (lots of them!) make the final electricity bill very expensive • 485 R$/MWh • By injecting (solar) energy into the end-user building, the avoided cost is the full bill

  11. Synergy between PV production and load profile Comfort temperature is such that positive deviatesprovide the highest response of demand due toair conditioning In Light (Rio), this happens at 23 Celsius (74 Fahrenheit) Comfort temperature: 23 Celsius Temperature

  12. First results of the new trend… • EcoSolar (Emerson Kapaz) announced a PV plant in Recife • US$ 350 million investment • Plant capacity: 800,000 panels totaling 120 MW per year • Oerlikon (Switzerland) technology used • Protocol of intentions signed with the State of Pernambuco

  13. Opportunities • Solar PV is already competitive against the final electricity bill • If the trend of Solar PV cost reduction continues, we can expect a “wave” of solar installation in Brazil • Rio de Janeiro will possibly lead: • Resource: sunny city • Synergy: peak PV production (“sunniest” hour) happens when electricity consumption is greater due to air conditioning. • Timing: 2014 World Cup and 2016 Olympics have a green appeal

  14. Challenges • Utilities currently have no incentives to promote energy efficiency as smaller demand equals less revenues in present regulation • The same (lack of) logic applies to Solar PV • The regulatory agency (Aneel) should be encourage to change the regulation • A possible approach • A variable amount which depends on the kWh consumption (as today) • A fixed amount (wire tariff) for the peak consumption, as the grid will still be used by consumers that install PV solutions • Also, utilities should be encouraged to get involved in PV leasing, installation, etc.

  15. Thank you rafael@psr-inc.com

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