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Are renewables making money in Brazil? June A-4 auction results

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02 July 2019

Are renewables making money in Brazil? June A-4 auction results

Report summary

On 28 June, Brazil’s Chamber of Energy of Commercialization (CCEE) held the A-4 auction for the regulated power market. The demand for this auction was surprisingly low at only 81.1 MW. But more surprising were the bid prices, setting a global record low for solar (US$17/MWh) and a second lowest price in the world for wind (US$21/MWh). Such low prices challenge the economics of renewables developers, but it is also clear evidence that they will rely on the wholesale market complemented by a merchant strategy. Read this insight for detailed analysis on: • The economics of the merchant strategy complementing these PPAs. • The details of this auction and how it compares with recent auctions internationally. • The internal return of these projects.

Table of contents

  • Hydro offer
  • Thermal offer
  • Wind offer
  • Solar offer
  • Are these projects making money?
  • Will this commercial strategy be used for future renewables auctions?

Tables and charts

This report includes 4 images and tables including:

  • Historical awarded prices for wind projects in Brazil and international benchmark
  • Historical awarded prices for solar projects in Brazil and international benchmark
  • Price comparison
  • IRR estimated for winning projects

What's included

This report contains:

  • Document

    Are renewables making money in Brazil? June A-4 auction results

    PDF 975.75 KB

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