Economic Feasibility of Photovoltaic Micro-Installations Connected to the Brazilian Distribution Grid in Light of Proposed Changes to Regulations

Abstract

Brazil is currently undergoing changes to regulations on distributed generation (DG), specifically for solar energy micro-generation. The changes proposed by the Brazilian Regulatory Agency suggest that only the cost of energy be compensated to investors. The service costs and other charges related to energy tariffs must be divided among consumers. Investors with existing installations and class entities have contested these proposals, calling them “sun-fees”. To date, no scientific papers have been published discussing these changes. The new regulations propose an end to cross subsidies, where all consumers (even those who do not have DG) pay for the transmission and distribution systems. This study compares the economic feasibility of micro-generation before and after implementing the new standards proposed by the regulatory agency. We used data on average electrical energy demand, energy price, and solar radiation in different regions. The national averages were used as a base comparison with other scenarios. The results show that projects are viable for all analyzed scenarios, however, after implementing the proposed changes, the discounted payback time is extended. This, however, does not make projects unfeasible.

Editorial for the Special Issue “Verifying the Targets—Selected Papers from the 55th International Universities Power Engineering Conference (UPEC 2020)”

“…The regulatory options have to be introduced in the formulation of cost-benefit analyses, to check whether the solutions are acceptable in terms of economic indicators such as the payback time. Doyle de Doile et al [26] address the effects of changes in the Brazilian regulation on the diffusion of micro-generation.…”