Why new DG projects are expected for rural Brazil

A series of power distributed generation (DG) projects in rural areas of Brazil are expected to go ahead thanks to a resolution published this month by sector
regulator Aneel, Roberto Corrêa, president of local shared generation cooperative Cogecom, told BNamericas

The new rule allows DG projects designed to operate in areas covered by power distribution licensees to have their excess electricity recompensed in areas
covered by distribution concessionaires.

Locally dubbed “permissionárias”, the licensees are small power utilities that were generally formed by cooperatives of farmers to supply electricity in rural
areas, mainly in southern Brazil.

Since these areas are very small and usually have cheaper energy prices, the potential of DG – which provides gains by returning surplus power to the
power distribution grid – is limited.

According to Corrêa, before the new resolution, it would not be worth it for DG systems to be recompensed in the licensee areas under commercial terms.

“The majority in these locations are rural consumers who already have incentivized [renewable] energy. And a local DG system would possibly generate
more power than the licensee firm itself consumes,” he said.

Six months ago, Cogecom started a pilot DG project consisting of a mini hydro plant with 300kW generation capacity in the area of licensee Coprel in Rio
Grande do Sul state, injecting surplus power into Rio Grande Energia’s (RGE) network.

The undertaking was used as a model by Aneel to prepare the resolution, which established a period of 90 days for the licensees and concessionaires to
adapt to the new rules. 

“Operationally speaking, it’s not that simple, since measurement of consumption is done by the licensee, and distribution by the concessionaire,” Corrêa
explained.

According to the Cogecom president, there are at least 10MW of stalled DG projects planned to be deployed in licensee areas, mainly in Rio Grande do Sul
state, as well as in Santa Catarina and Paraná states.
“Now, in two or three months’ time, we should already have DG plants starting operations,” Corrêa said. 

DG REGULATION
Approved by Aneel on February 7, the new resolution that positively impacts DG projects in rural areas regulates federal law 14,300/2022, considered to be
the!legal framework!of the distributed micro and mini generation.

Since the publication of the law, on January 7, 2022, more than 780,000 distributed micro and mini generation connections have been made by distributors
throughout Brazil, totaling more than 7.6GW of installed power.

These figures are an increase of 60% in relation to the number of connections and 54% of the installed power compared with that verified in the 13 months
prior to the publication of the law.

DG is expected to grow around 15% in Brazil this year, adding some 8.5GW of installed capacity.