The World's #1 Renewable Energy Network for News, Information, and Companies.

Brazil to Encourage Local Solar Equipment With Cheaper Loans

Brazil to Encourage Local Solar Equipment With Cheaper Loans

Brazil will offer cheaper funding to solar projects that use locally made equipment and parts in a bid to spur a national manufacturing industry as the country prepares to ban solar-cell imports by the end of the decade.

Developers proposing solar-energy projects at an Oct. 31 auction will have the cost of borrowing from the government lowered in proportion to the local content that they commit to using, the state-owned BNDES development bank said in an e- mailed statement today. The standard cost of borrowing from the bank’s Finem program is at least 6.9 percent and as low as 2 percent under a special program to help avert climate change.

Brazil, which gets less than 1 percent of its power from solar generation, is seeking to develop a photovoltaic industry to cut dependency on imports and diversify away from costly thermal plants as well as hydro-dams that are subject to droughts. The subsidized loans linked to local content are part of policies drafted by BNDES and the country’s Energy Research Agency, known as EPE.

“In Europe and in the U.S. the solar chain is already better developed,” Antonio Carlos Tovar, head of renewable energy development for BNDES, said in an interview in Rio de Janeiro on July 29. “It seems to make sense to start the insertion of solar energy in our mix.”

BNDES Program

Developers will be able to finance as much as 65 percent of their projects with funds from the BNDES’s Finem program and 15 percent with the program to fight climate change, known as Fundo Clima.

Manufacturers will have the “freedom to manage their own strategy” and choose what items to produce locally and which ones to import until 2020, said Tovar.

BNDES will allow solar developers to import photovoltaic cells until 2020 before the use of locally produced ones becomes mandatory, Tovar said in the interview last month.

“For the bank’s cheaper financing, the requirement for local production of cells starts in 2020. Manufacturers have six years to decide to produce cells in Brazil,” Tovar said today by phone. “If companies start producing cells before, BNDES’s percentage of help increases considerably.”

Until 2017, only locally produced frames and some electronic components will be required, and in 2018 more parts will be added to the list.

“It is clearly an industrial policy push for the sector in Brazil,” said Lilian Alves, a Sao Paulo analyst at Bloomberg New Energy Finance. “But the local content requirements are hard, given the current structure of the solar sector, which doesn’t have big logistical issues for importing parts.”

See Also: Brazil Local Content Rules Hurting Major Wind Suppliers

Copyright 2014 Bloomberg.

Lead image: Sunrise in Rio via Shutterstock

RELATED ARTICLES

Wind turbines

Why It's Time To Get Real About Energy Security

Hannah Smith, Contributor Energy is Europe’s quiet crisis. While the clamour of failing economies, desperate migrants and political clashes grabs the headlines, energy policy is rarely front-page news, but it should be — the statistics are shocking.

Largest Solar Farm in Virginia Just Commissioned by Amazon Web Services

Renewable Energy World Editors Back in 2012, Amazon received a failing grade from Greenpeace regarding its use of renewable energy to power its cloud centers. Skip a couple years and in 2014 Amazon Web Services (AWS) announced a goal of achiev...

A Closer Look at Fossil and Renewable Energy Subsidies

Susan Kraemer, Contrubutor A new study by the International Monetary Fund puts the total cost of fossil fuel subsidies at approximately $10 million a minute globally, when health costs and environmental degradation are included, never mind the effec...

How to Win Planning Permission for Renewable Energy Projects (and Influence People)

Tildy Bayar, Contributor At Tuesday afternoon’s POWER-GEN Europe and Renewable Energy World Europe conference session in Amsterdam, Paul Davison of PR firm Proteus discussed how to best communicate with the public regarding renewable ene...

CURRENT MAGAZINE ISSUE

Volume 18, Issue 3
1505REW_C11

STAY CONNECTED

To register for our free
e-Newsletters, subscribe today:

FEATURED PARTNERS



EVENTS

Microgrid Global Innovation Forum

Microgrid Global Innovation Forum  This event brings together thoug...

Grid Edge Live

Grid Edge Live 2015 The impressive two and a half day agenda addresses k...

2015 Solar Power International

Stop by and visit Canadian Solar at the 2015 SPI show!

COMPANY BLOGS

Signing a Solar Lease? Here are Five Things You Need to Know

Solar leases have grown in popularity, and they continue to be one of th...

DIY: Don’t Install Yourself

You finally made the choice to go solar. Seems like it might be pretty e...

Capturing Your Prospects' Attention In Three Sentences

You have about 15 seconds to capture your prospects’ attention, wh...

SOCIAL ACTIVITY

Tweet the Editors! @megcichon @jennrunyon

NEWSLETTERS

Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now  

 

FEATURED PARTNERS