WHY IT'S IMPORTANT
The batteries would be able to store energy from wind and solar power, renewable sources which, although growing in importance for Brazil's power grid, remain limited in that as they are less predictable than thermoelectric or hydro power units.
ADDITIONAL CONTEXT
Brazil's government often holds auctions to buy power capacity to be used when demand is high but supply is lower, such as in the late afternoons when solar power units stop producing energy.
The June auction will be the first from the government allowing batteries and storage systems to participate, and will be exclusive to such technologies.
BY THE NUMBERS
Oliver Wyman estimates that, if the government purchases around 300 megawatts of energy capacity, the winners of the auction could spend $450 million to get their projects online.
According to the consultancy firm, if Brazil were to have those batteries and storage power systems working already, the nation could have reduced the amount of fossil fuels burned by thermoelectric plants by 21% between April and December of 2024.
KEY QUOTES
Oliver Wyman engagement manager for energy and natural resources Rodrigo Borges said that the estimated investments required could still change depending on details about the auction which have not yet been made public.
"One of the main doubts is regarding the size of power demand and its location," Borges told Reuters. "This can create more bottlenecks or fewer bottlenecks, or encourage more or less investment," he added.
WHAT'S NEXT
According to the government's proposal, the auction will take place in June and will offer 10-year contracts, with supply beginning in July 2029. The systems will have to deliver maximum power availability equal to four hours a day, receiving a fixed price for this.
