BRAZIL Trends and Developments Contributed by: Márcio Pina, André Serrão, Thiago Furtado and Gustavo Oliveira, Advocacia Bettiol
Cuts in Renewable Wind and Solar Energy in Brazil’s Interconnected Grid One of the most important regulatory issues in Brazil’s 2025 Agenda is the restriction of solar and wind plant energy due to the lack of capacity of the transmission systems and the supply of energy above demand. The expansion of renew- able energy generation from intermittent sources – such as wind and solar energy – requires a new approach in order to co-ordinate, plan and programme the efforts of the National Intercon- nected System ( Sistema Interligado Nacional or SIN). On 15 August 2023, a blackout affected all of Brazil. According to the National Electric Sys- tem Operator ( Operador Nacional do Sistema Elétrico or ONS), “an occurrence in the National Interconnected System (SIN) caused the inter- ruption of 22,547 MW, of the total of 73 thou- sand MW that were being served, representing approximately 31% of the total load at that time. The event caused the electrical separation of the North and Northeast regions from the South, Southeast/Central-West regions, opening the interconnections between these regions and affecting 25 States and the Federal District”. Among other conclusions, the ONS stated that “the abrupt reduction in voltage observed in the field after the loss of a single transmission line was a consequence of the unexpected per- formance of wind and photovoltaic farms, far below that obtained by the ONS in its studies”. On blackout day, the ONS ordered the suspen- sion of wind and solar generation to avoid power fluctuations during the recomposition of loads and to allow this control to be carried out by the hydroelectric plants. From that day on, the National Electricity Regu- latory Agency, ANEEL ( Agência Nacional de
Energia Elétrica ), and the ONS have adopted severe restrictions and conditions in electric- ity generators’ authorisation to access Brazil’s interconnected transmission system, in addition to increasing generation cuts at wind and pho- tovoltaic power plants. Projects that had been operating with an average generation of over 90% now suffer cuts of up to 50%. Under Article 13 of Law No 9,648/1998, the ONS is responsible for the “co-ordination and control” of the generation and transmission of electric energy in the SIN, including “planning and pro- gramming ” to optimise the system. As part of its activities, the ONS sometimes imposes restrictions on the operation of power plants, mainly in cases where energy supply exceeds demand, when there are problems in the transmission network or, for any other rea - son, when there is a need to guarantee the sys- tem’s safety and reliability. The imposition of generation cuts has become more frequent with the expansion of renewable energy generation, especially wind and solar energy. There have been big economic conse- quences for generators, as these cuts are unpre- dictable and were not foreseen at the time of project development. This leads to instability in project financing. ANEEL classifies the reasons for operating restrictions as: (i) external unavailability; (ii) electrical reliability; and (iii) energy. The latter is related to the impossibility of allocating energy generation to the load. The Agency allows finan- cial compensation to generators only when the operating restriction is due to external unavail- ability. Generation cuts due to electrical reliability and energy reasons are not reimbursed.
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