The Brazilian solar energy market is responsible for 5.6% of the entire global demand for photovoltaic modules in 2021. This was one of the conclusions of a survey conducted by consultancy Greener with 3,767 companies in the sector between December 2021 and January 2022, to which Valor had exclusive access.
One of the reasons why Brazil is one of the main consumers of equipment on the planet is due to the segment’s boom last year. The necessary volume of photovoltaic modules to supply the Brazilian market surpassed 9.7 gigawatts (GW), a growth of more than 100% in relation to 2020.
Greener CFO and coordinator of the study, Marcio Takata, assesses that Brazil has had a strong expansion in recent years since in 2017 the Brazilian share in relation to the global market represented only 0.9%.
“Between 2019 and 2020, Brazil had a limited growth in demand for equipment. But in 2021, the country resumed growth and the volume of equipment doubled in comparison with the previous year and represented 5.6% of global demand.”
The executive lists some factors that help understand the importance of Brazil in this context, such as the rise in energy tariffs, the competitive market, and the entry into effect of Law 14,300/22, which establishes the legal framework for self-generation of energy – which is likely to attract investments of around R$35 billion to Brazil.
“With the acceleration in the volume of modules in the last quarter and the entry of equipment in Brazil, we notice a greater market appetite for 2022. Another important indicator is the regulatory change, which for some business models means an acceleration of investments,” predicts Mr. Takata.
Due to the international dynamics, last year the price of equipment had an 8% increase pulled by the cost of freight, due to the lack of containers, ports bottleneck, and pandemic isolation measures. The rise in commodity prices, high demand for components, and exchange rates have culminated in worldwide equipment supply problems.
Given the challenging scenario, Mr. Takata says that some projects were delayed or adjusted to suit the market dynamics and rising prices. However, he points out that the service chain and the volume of companies operating in the segment brought a lot of competitiveness in the Brazilian market, which absorbed part of the rise in prices.
“Even pressured by costs, the segment continues to be competitive. We had a rise in energy tariffs throughout 2021 and in 2022 we will still have the reflexes of the water crisis and the pandemic. This brings a new dynamic and the investment in solar energy continues to be attractive to the consumer,” he analyzes.
The distributed solar generation is present in a little more than 1% of the consumer units in Brazil, according to data from the National Agency for Electrical Energy (Aneel), and is used mostly in homes and businesses as an aid in reducing the electricity bill (900,000 consumer units against 86 million consumer units).
The rise in Brazil’s benchmark interest rate Selic is reflected in the cost of financing, yet solar financing has expanded, supporting 57% of sales made in 2021, being a fundamental means of leverage for the expansion of access to photovoltaic generation.
Despite all the obstacles that entrepreneurs will face, the survey found that 92% of integrators are optimistic about the volume of business in 2022 – a 6% increase in positive expectations compared to 2020.
Source: Valor International