Brazil’s designation as the host of COP30, to be held in Belém, has sparked important discussions about the role of civil society in driving meaningful change. Inclusion and local engagement are essential for advancing decarbonization. This is particularly true for the multi-faceted challenges faced by Brazil’s power grid – a matter of growing debate among power market players.

Conducted over two months using primary and secondary data from Brazilian stakeholders and credible sources, the study identifies 18 actionable opportunities. Four of these are prioritized, as they are deeply tied to the current market structure and regulatory barriers affecting the adoption of new technologies.

These opportunities are particularly relevant given that many of the current challenges stem from the lack of effective regulations to address grid-related issues, as detailed below.

Curtailment Management Strategy

Wind and solar curtailment in Brazil have exceeded 25% since 2023. Managing this while integrating rapid renewable growth and upgrading transmission infrastructure remains a major challenge, while concerns over plant compensation add complexity. Aurora’s analysis recommends continued engagement with existing work groups for curtailment mitigation, focusing on immediate topics such as regulation updates and cost allocation, in addition to assessing the possibility of revamping the operation’s algorithms by leveraging international experience.

DER Policy Framework

DER capacity has grown by over 1600% from 2019 to 2024, driven by sizeable compensation mechanisms and surcharge exemptions — now being gradually phased out. The challenge now lies in balancing DER benefits with grid stability. Proposed initiatives are to foster development of mechanisms that balance DER deployment, supporting creation of action plans for initiatives like the transition to a DSO model, besides establishing dialogues about net metering upgrades and providing intelligence through international benchmarks.

Ancillary Services Market Assessment

Limited access to ancillary service markets restricts investment in energy storage, which is critical for integrating renewables and managing grid variability. The analysis proposes supporting studies on market-based ancillary services, publishing findings, and promoting them through industry events and stakeholder engagement.

Energy Storage Regulatory Development

Deployment of advanced technologies, such as large-scale grid BESS units, is still sparse and needs regulatory guidance. Aurora recommends active participation in shaping BESS regulations, contributing to public consultations, applying international experience, and identifying supply chain bottlenecks to enable scalable deployment.

Note to Editors:

The authors of the study will present detailed findings during the upcoming public webinars

“BRAZIL Power Grid: A Health Check and a Call for Action PT-Portuguese Version “

“BRAZIL Power Grid: A Health Check and a Call for Action EN-English Version”

scheduled for 15 and 17 July respectively at 11:00 – 12:00 BRT/ 16:00 – 17:00 CEST.