Energy production in Brazil

The use of renewable energy in Brazil places the country in a prominent position in the regional and global scenario. According to data from the Ministry of Mines and Energy, renewable sources reached a demand for participation of 46.1% in the energy matrix, which represents three times the world percentage.

Knowing the geographic characteristics of Brazil and all its natural resources, the country in fact has great potential and vocation for renewable energy sources. However, we also have to admit that the country still faces a series of obstacles that prevent it from reaching its full capacity.

In today’s article, we will talk about the current state of energy production in Brazil, and also about a future perspective that is particularly interesting for international investors. To find out more, continue reading.

Overview of renewable energy in Brazil and in the world

In terms of installed renewable energy capacity, Brazil ranks third in the world, with 141,932 MW. We are behind only China, with an incredible 788,916 MW, and the United States, with 282,656 MW.

These figures are for the year 2019 and were collected by the International Agency for Renewable Energy (IRENA). In comparative terms, we are still a considerable distance from China.

This is an indication that Brazil is still far from exploiting its full potential. And this was proven by the 2019 Global State of Renewables Report, from the United Nations Environment Program (UNEP).

According to that report, global investment in green energy has exceeded $2.6 trillion in the last decade. Also according to UNEP, five countries have excelled in investing in solutions to reduce the effects of climate change:

• China
• India
• U.S
• Japan
• Spain

Considering the potential of Brazil in the field, and also the future demand for energy, it is seen that there is a vast field for investments in different segments, ranging from large infrastructure projects, to the generation of small load energy, with solar and wind generators. that will certainly be in the residential, commercial and industrial properties of Brazil in the 22nd century.

The annual consumption of electric energy in Brazil is 555 TWh (Terawatt-hour), with an average growth, in the last ten years, of 4% per year. With this level of demand, there is no denying the need to make investments to guarantee supply. After the 2001 blackout, energy security became one of the most urgent issues for the country’s development.

In recent years, Brazil’s installed capacity has jumped. In 2002 it was 80.3 GW and in 2013 it reached 124.8 GW. The growth in the period was 55.4%, an average of 4.2% per year, very close to the growth in consumption. Today, hydroelectric plants alone account for 85.3 GW of power. And thermal plants – which in 2002 produced 8.5 GW – are already responsible for 19.3 GW. By 2025, the installed capacity should reach 195.1 GW.

In December 2021, a study was released with forecasts of energy demands in Brazil for the next 5 years (2022-2026). The document, prepared by the CCEE (Electric Energy Commercialization Chamber), ONS (National Electric System Operator) and the EPE (Energy Research Company), revised the projections for the years 2022, 2024 and 2025.

According to the study, demand in 2022 is expected to grow 2.7% compared to this year, 0.2 percentage point less than previously projected. Within the scope of the Annual Energy Operation Planning 2021-2025, the expected increase had been 2.9%. For 2023, the projection of a 3.6% increase in relation to the previous year was maintained. For 2024 and 2025, there were reductions in the revision of the numbers.

There are important challenges on the horizon, with the projected electrification of the fleet of motor vehicles, and also with the expected restrictions for the operation of thermoelectric plants. These are factors that necessarily need to be observed by investors in Brazil.

Gescon

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