28/06/2013 back

Piauí - Investments in wind and solar photovoltaic

Favorable weather conditions have been attracting investments in new wind and solar photovoltaic power projects from domestic and foreign investors. With the expected capacity, the state could go from electricity importer to exporter

Tatiana Resende, from Agência CanalEnergia, Special Report

A new energy scenario has been unfolding in the state of Piauí. With favorable winds and abundant solar radiation, domestic and foreign investors of the electricity segment have been choosing the state for their new projects. And the offer has been so big that for the 2013 reserve energy auction to be held on 23 August, Piauí is the fifth state with more projects, including 32 registered wind power projects that could produce up to 943MW.

"Naturally, other companies we don’t know of will also offer energy, but we are quite pleased with the situation as it is. We are very optimistic about the electricity sector in Piauí, especially regarding renewable energies”, Edson Ferreira, Secretary of Mining, Petroleum and Renewable Energies for the state of Piauí, said.

According to Ferreira, by 2016, Piauí’s coastline and southeast region are expected to produce over 560MW of wind power, and with this capacity, the state would go from importer to exporter of electricity. Of the three most recent investments in the region, only Tractebel’s Pedra do Sal wind farm is already operational. Located on Piauí’s coastline, the farm currently supplies 17MW to the grid, but a second expansion phase, for which the environmental licensing process is underway, will increase its installed capacity to 90MW.

Wind farms are expected to produce over 560MW in Piauí
Edson Ferreira, Government of Piauí

This project will have an initial investment of R$300 million, and another wind farm is being built by Ômega Energia on the coastline to supply 70MW to the grid. The company’s plan for this wind farm also includes a second expansion phase to produce additional 60MW. “The company hopes to invest roughly R$4 billion in the state in the next four or five years. By April 2014, the first phase should be completed, and the second phase should be ready by the end of the same year”, the Secretary added.

The Chapada do Araripe wind farm, located in the municipality of Caldeirão Grande, in the interior of the state, is another big project to be developed in Piauí, and it will initially produce 416MW. The investments being made by Queiroz Galvão Energias Renováveis will amount to R$1.48 billion during the project’s initial phase and may reach R$3 billion altogether. “This is the initial production, but some studies show that this farm could eventually produce 800MW. The wind farm will generate over 1,400 direct jobs in the region”, Ferreira pointed out.

Overall, wind power exploration in Brazil’s Northeast region is quite advanced. According to Ômega Energia’s Portfolio Director, Gustavo Barros Mattos, the region’s typical winds support good expected wind power production per installed megawatt. “Wind power is a reality in developed countries, and Brazil is already turning its attention to it, as we can see in Piauí.  Both domestic and foreign companies are investing in the region, and this will bring several medium- and long-term local benefits”, the Secretary added.

The construction of the Chapada do Araripe wind farm alone will create around 3,400 direct jobs over four years. Ferreira explained that there is social responsibility towards the region too in terms of supporting the community’s health, education and other sectors, as well as enhancing the economy and generating income for the local population.  “Moreover, the state of Piauí will qualify and train local people, and after the wind farm is installed, more direct jobs will be created to ensure its maintenance. Over time, we believe an industrial park will be created around the project, because the installed machines and turbines will require maintenance for eight to ten years", the Secretary said.

For Ômega Energia’s Portfolio Director, Gustavo Mattos, the benefits brought by the wind farms also include “the reduction of greenhouse gas emissions and supply of clean, renewable energy to more than 280 thousand homes, enabling the region to become self-sufficient in energy as of 2014. The quality and stability of the electricity supply will improve, as will the state’s energy balance sheet, which is currently showing a deficit”.

Stability of power supply and energy balance sheet
Gustavo Mattos, Ômega Energia

But it is not only good winds that have been benefiting the state. Another energy source is receiving large investments in the region: solar photovoltaic power. With solar radiation of 2,093 kWh/m2/year, Teresina, the state’s capital city, has favorable technical conditions for generating electricity from the sun. And the government has also been contributing to attract investments from companies wishing to invest in the state.

One of such companies is Vensolbras. Their project for a plant to be constructed in the municipality of São João do Piauí  is ready and the environmental licensing process is underway. According to the Secretary, this solar power plant will have a capacity of 200MW. “They have already purchased the land and, depending on how the environmental licensing process progresses, the idea is to start building the plant by the end of the year", he said. The project has three phases. The first phase will have an installed capacity of 1MW, with investments of approximately R$8 million and creation of 70 direct jobs. In the second phase, the installed capacity will be 5MW, with investments of approximately R$40 million and creation of 100 direct jobs. And in the project’s final phase, the installed capacity will be 200MW, with investments of R$1.2 billion and an offer of 250 direct jobs.

Solstício Energia, a company that originated from experiences conducted at the University of Campinas, is also interested in investing in Piauí. Its project includes the installation of photovoltaic panels in public buildings to produce energy from the sun. This could contribute to the electricity supply to schools, hospitals and other buildings. According to the company’s Technical Director, Bruno Wilmer Fontes Lima, such actions help develop the energy sector of the state of Piauí, which has extremely favorable conditions for this type of investment in the Northeast region.

The Secretary also mentioned a letter of intent signed with a Germany company, whose name has not been disclosed. It is still early in the negotiations, but the idea is to install a solar power plant to produce 250MW and a photovoltaic panel industry in the state. “Some areas have been considered, but this information has not been disclosed yet. We [the state] have already signed the letter and are waiting for the process to unfold. But we want to do it and are looking forward to the investment of approximately R$1 billion”, Ferreira said.

Aiming to attract even more businesses, the state of Piauí will have its first wind and solar power atlas.  At a meeting between the government of the state and Pedro Cavalcanti, Vice-President of Abeeólica, the businessman said that “Piauí should be congratulated for the initiative of offering such a valuable tool to assist investors of the alternative energy market. Of course, no investor will decide to do business based on the atlas alone, but it will help us gain a better understanding of the opportunities and the government’s policies for this sector”.

Investment of R$320 million in electricity distribution
Pedro Mateus de Oliveira, Eletrobras

For the Secretary of Mining, Petroleum and Renewable Energies, the atlas will eliminate steps and optimize the investment process.  “The private sector comes to the region to study it directly, but with the atlas, we will share information on wind corridors, locations, the most beneficial areas for different types of projects, and so some project implementation stages can be eliminated", he said.

According to Ferreira, the study is expected to begin as soon as possible. “We are starting the project today. On average, it takes 18 months to make an atlas like this. I believe we will have some data by the first quarter next year", he said.

Regarding distribution, at the start of the year, Eletrobrás Distribuição Piauí announced its plans to invest R$320 million in 2013 to improve and modernize the state’s electricity distribution. According to Pedro Mateus de Oliveira, Planning and Expansion Director of Eletrobrás, “the idea is to make up for lost time and update the system in both technological and technical terms.

According to the Director, the investments will be concentrated in the central region of the state. Altogether, 10 new substations will be constructed and 11 will be modernized, but Oliveira believes the biggest challenge for the distribution company will be the south region, as it lacks distribution points and therefore it is more difficult to meet the local demand. The long downtime led to the obsolescence of the network, and this increased the loss rate. “The population repeatedly asked for the connection. As the company didn’t do it, they did it themselves. The improvisations ended up causing a lot of loss”. The Director says around R$48 million will be financed by the World Bank to solve the problem.

The state is witnessing a change of status with the discovery of the region’s energy potential.  As is the case around the world, in Piauí, renewable energies are also a central focus of companies and governments. Producing clean energy in a sustainable way not only benefits the atmosphere, but also generates jobs and income for the local people. “Our state is still an importer. But with these investments, we will soon become exporters to other states. There has been a lot of interest from both domestic as foreign investors in Piauí, and we believe that soon we will become major wind and solar power producers", the Secretary concluded.