400 Solar Pv Projects Registered In Brazil Auction

Developers have registered 400 solar PV projects totaling 10.8 GW in Brazil's reserve auction, which is scheduled for October 31st, 2014. The reserve auction will follow an energy auction in September, and will be the first at the national level to include a separate section specifically for solar projects.In the past solar projects have been unable to compete on price with wind and hydro in renewable energy auctions, and this solar carve-out in a national auction follows a solar-only auction in the state of Pernambuco in December.Neither the size of this solar-only category nor the maximum bid price have been announced at this time, although Brazilian developer Solatio Energia has told Bloomberg that it expects 1 GW of solar to be awarded. GTM Research says that caution is appropriate until more details are revealed. "I'm optimistic about the reserve auction, however the key question will be if the power purchase agreement price will be high enough to overcome the tax burden, and if financing will be made available for those projects," explains GTM Research Solar Analyst Adam James.James notes that none of the projects awarded in the Pernambuco solar auction have yet begun construction. Unlike national auctions the Pernambuco auction did not award contracts with off-takers. James also says that low bid prices - around USD 0.10/kWh - were an issue.Brazil has attracted a lot of interest from solar developers due to good market fundamentals. However, commercial interest rates around 12% and taxes at the national, state and local levels both present challenges to developers, particularly given the low bid ceilings in Brazil's auctions to date."Auctions are only one piece of the puzzle," says James. Following the announcement GTM Research has not upgraded its forecast for Brazil. The company expects the nation to install on 34 MW of solar PV in 2014, followed by 110 MW in 2015 and growing to 180 MW in 2016.James says that there have been discussions about making financing available for renewable energy projects through the Brazilian Development Bank (BNDES), which offers lower interest rates. However, a local content requirement currently makes such financing unavailable for solar projects.Additionally, development banks such as the InterAmerican Development Bank (IDB) or the World Bank's IFC could fund these projects, but they too may be discouraged by the slim margins created by low bid ceilings and high taxes.James stresses that Brazil has good long-term potential, but says that several issues need to be resolved before the market can experience rapid growth. Brazil in the past has been very reliant on cheap hydroelectricity, which has been problematic during periods of drought, but this may be changing. "They've been very focused on cost," notes James. "Brazil is shifting from a cost-based approach to a cost and value-based approach." ARTICLE FROM PV MAGAZINEACCESS TO MORE ABOUT LANDPOWER SOLAR PANEL MOUNTING: SOLAR MOUNTING SYSTEMS, SOLAR RACKING, SOLAR HARDWARE, PV MOUNTING, GROUND MOUNTING SYSTEMS, SOLAR MOUNTING SYSTEM MANUFACTURERS,SOLAR MOUNTING