Canada Investments in Brazil’s Solar Energy
A recent research made by the Blomberg New Energy Finance (BNFE), shows that Brazil will soon change its energy matrix from mainly hydroelectric to other alternatives energy matrices. The diversification of energy sources is a strategy that aims to attend the growing demand for energy in Brazil. Researchers estimate that by year 2050 the demand of energy will triplicate in Brazil. Therefore, investments on the field of alternative energy generation are required. Solar energy was reported as the alternative source of energy with the greatest growth potential in Brazil.
Knowing the great potential of solar energy in the country, The Canadian company, Canadian Solar Plus wants to invest almost US$ 715 million in the development of solar energy in Brazil until 2018. The company will have the financial support of the Brazilian National of Economic and Social Development Bank (BNDES).
According to studies conducted by the Brazilian Association of Photovoltaic Solar Energy (ABsolar), the participation of solar energy in Brazil is expected to increase from 0.02% to 4% in 8 years generating revenues of approximately US$ 175 billion until 2030. Mr. Shawn Qu, CEO of Canadian Solar, stated that perspectives for the sector in Brazil are promising. For that reason, the company plans to make several investments in the country.
Although the Brazilian Government has played an important role in stimulating the production of solar energy by providing tax exemption to companies that invest in Brazil solar energy production, there is still more to be done. Brazil still has to import great part of the technology used by this sector, due to the fact that Brazilian companies have not been investing in R&D within the field of solar energy. Thus, a good solution would be to cooperate with another country that has both, technology and expertise in the field of clean energy, such as Canada.
The Mercosur-Canada FTA negotiation should have a positive impact on the clean energy sector. If implemented soon, expectations are that the agreement will foster the investments from both Canadian and Brazilian companies at the field of solar energy and increase research in this field in Brazil.
Source: Brazil-Canada Chamber of Commerce magazine, Publication No 61, July/August 2016.