Brazil is making a serious entrance into the global wind power market. Based on new government energy plans, in a few short years, wind could become the second largest power generation source in the country.
The Brazilian government plans to boost installed wind capacity to 11.5GW by 2020 – a significant increase from the 1.5GW installed today. A series of auctions will open 6GW worth of wind farm opportunities to the global marketplace by 2015.
To encourage sector growth, the government will offer tax breaks and cheaper financing rates to wind developers, a fact which has not been lost on global wind giants Gamesa, Iberdrola, Vestas and Alstom, all of whom have professed a strong interest in Brazilian wind investments. Brazil’s plans are so aggressive that wind may very well leap ahead of natural gas to become the country’s second largest source of power generation, following hydroelectric power, by 2015.
Cost reductions as a result of technology developments have made wind’s future particularly rosy in Brazil. Data shows it is now 70% cheaper to build a wind farm in Brazil than it was 7 years ago. Brazil is now able to invest in the industry at a level which did not make economic sense in the past.
“In Brazil we have large renewable resources, first hydro and then wind and biomass so we prefer to invest in sources that bring good power prices to consumers,” remarked Elbia Melo, CEO of the Brazilian Windpower Association. “The government wants consumers to get the best power price, and they can definitely do this with wind now.”
Brazil has become the “world’s most coveted wind power market,” says Melo. “China purchases everything it needs to build its own farms domestically while India buys from China, so European and U.S. developers are left with Brazil as the only real viable market.”