Renewable energy business in Brazil

23.07.2010 By: TRANSFER based on ABEER

In spite of all of the current developments, Brazil’s untapped potential to employ renewable energy resources such as biomass, solar (photovoltaic and thermal), small hydro and wind for electricity generation is tremendous. Recent economic analyses indicate that these indigenous energy sources can provide cost-effective and environmentally-sound alternatives to fossil fuel-based generation.

The countries’ interest in developing alternative sources of energy started in 1973, after the oil crisis. The first trial of alternative energy became a success and Brazil is nowadays well known worldwide for its ethanol production of sugarcane.

As a result of the ‘pro-alcohol’ program in 1973, developments in the field of bio-ethanol have brought this sector on a higher level and statistics of 2008 showed that Brazil accounted for as much as 38% of the production worldwide and can be considered America’s baby brother. Currently bio fuel is dominating the Brazilian market and it is hard to still find cars that are not designed as flexible fuel or bio fuel vehicles. In fact the same tendency is noticed in Europe, where European directives oblige its Member States to combine traditional fuels and bio fuels, up to a minimum mix of 10% of bio fuel at 2020.

However, immense investments in storage and transportation of ethanol still have to be made in Brazil. Foreign companies within this sector could respond to this need. Consultancy and training in the construction of railways, improvement of water transport and port facilities are very valuable. The development of intermodal connections, engineering design and dredging are needed as well, next to suppliers of navigation systems, equipment, software, barges and supply boats and containers. The middle and southern part of Brazil offers opportunities in the supply of technology and machinery. Especially for companies that focus on technology for the 'second generation' biofuels there are opportunities.

But Brazil is also making interesting progresses in the development of other alternative renewable resources, like solar and wind energy, as well as hydropower energy. Although these forms of renewable energy do not coincide with the global expectations, they create important possibilities for foreign companies.

Solar energy is an example of an upcoming way to produce renewable energy. Solar energy, when applied in its thermal form (heating water and air), offers many possibilities. Energy production from solar heat is particularly promising in the north-eastern part of Brazil and is financially feasible for everyone. Researchers concluded that approximately 500 MW of solar energy can be produced on an annually base. In this stadium in particular technology, knowledge and financing is required. Supplying components such as panels, inverters and batteries are also a very promising market.

Another form of renewable energy, wind energy, appears to be the country’s pupil. The Brazilian government does everything to stimulate and activate the development of this emerging market, which will probably focus on Rio Grande do Norte in the Northeast. This windy region alone hopes to arrive to a wind production capacity of 8.000 Megawatt, which will enable this sub state to sell energy to other parts of Brazil. Sources mention that Brazil annually should be able to generate approximately 300.000 Megawatt. This is 20 times the energy capacity generated by the famous Itaipu dam, considered to be Brazilian’s pride when it comes to alternative energy sources. The above described developments offer a lot of opportunities for consultants, mast and turbine builders and soil scientists.

To give foreign companies active in the renewable energy sector the chance to make use of these opportunities, TRANSFER is currently planning on organizing a trade mission to Brazil. Interested in more information? Please contact us.