Brazil's Energy Storage Demand Surges

According to foreign media reports, the Brazilian Ministry of Mines and Energy recently announced plans to purchase battery energy storage systems on a large scale in 2025 and publicly solicit opinions for the capacity reserve auction to be held. Alexandre Silveira, Minister of Mines and Energy of Brazil, said that in addition to this auction, an auction of thermal power facilities and hydropower facilities reserve capacity is also planned. He said that the goal of this auction is to promote battery energy storage systems in Brazil and attract large battery energy storage manufacturers from China and other countries, as well as some energy storage battery accessories such as Aluminum Battery Case suppliers.

As the largest economy in South America, Brazil has a large economic volume and population base, a high proportion of electricity bills to national income, high per capita electricity consumption, low grid coverage, and frequent power outages. With the continuous release of demand for new energy industries, Brazil is considered to be the fifth largest photovoltaic storage market in the world and the largest in South America.

Brazilian Energy Status.
In recent years, power outages have occurred frequently in Brazil, with a wide range of impacts, causing great inconvenience and economic losses to residents and businesses. As the country is also affected by drought, resulting in reduced hydropower generation, the demand for home and corporate energy storage systems is rising.

Much like Southeast Asia, Brazil's grid infrastructure is relatively old and lacks modernization and maintenance investment for a long time, making the grid particularly vulnerable to emergencies. Although urban electricity demand is growing, the speed of grid system renewal has not kept pace. Coupled with storms, hot weather and other natural phenomena, power supply interruptions have been further exacerbated.

Against this backdrop, renewable energy development projects such as solar, wind and photovoltaic have received strong support from the Brazilian government.

Government benefits and BRICS support.
Starting this year, Brazil has included battery and energy storage solutions in energy auctions, aiming to ensure Brazil's energy security for the next six to seven years. The goal of the auction is to promote battery energy storage systems in Brazil and attract large battery energy storage manufacturers and related accessories such as Pack Aluminum Housing suppliers from China and other countries.

In addition, under the BRICS cooperation framework, China has promoted the establishment of cooperation mechanisms such as the New Development Bank and the Contingency Reserve Arrangement. The New Development Bank provides financing for projects such as renewable energy and urban infrastructure in Brazil. Agricultural technology cooperation among BRICS countries has promoted the export of Brazilian agricultural products to China, and scientific and technological cooperation has promoted Brazil's innovative development in the fields of artificial intelligence and green growth.

Brazil's resource advantages.
Brazil is rich in sunlight resources, ranking first among the BRICS countries, with more than 3,000 hours of sunshine per year, and abundant sunlight resources; there are large tracts of underutilized land in the north and central regions, which are suitable for installing solar power generation equipment, and the country mainly uses hydropower stations to store electricity.

85% of the country's electricity comes from renewable energy. Last year, photovoltaic installed capacity reached 12.4GW, and onshore wind power installed capacity reached 5.9GW. The continued growth of new energy installed capacity is driving the expansion of its electrochemical energy storage market.

The development of solar energy in the entire Latin American region, including Brazil, is still in its infancy. Although Brazil is actively developing its local photovoltaic manufacturing industry, its local production capacity is limited, the industrial chain is incomplete, and it still needs to rely on imports, especially imports of mid- and upper-stream products from China. For a long time, Brazil's energy transformation will be highly dependent on Chinese photovoltaic companies.

Brazil has great energy storage potential.
Many reasons are driving Brazil's energy storage demand. Some analysts expect that by 2030, Brazil's lithium-ion battery industry will grow at a compound annual growth rate of 20% to 30%. Demand for lithium battery-related accessories such as Pack Aluminum Housing has also increased.

Brazil's new power generation capacity reached 11.9GW in 2023, second only to China, the United States and Germany. Photovoltaic power generation is growing at a rate of more than 1GW per month, and the cumulative photovoltaic installed capacity is close to 38GW, an increase of 54.8% over 2022, and photovoltaic solar power generation ranks sixth in the world. Currently, Brazil's solar installed capacity has reached 46GW, and it is expected to add 2GW by the end of this year. It is expected that by 2050, Brazil's energy demand will more than double.

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