The Brazilian Market Of Distributed Solar PV Generation - Annual Report 2016

I NITIATIVE:

THE BRAZILIAN MARKET OF DISTRIBUTED SOLAR PV GENERATION Annual Report

2016

S PO N S OR S H I P : g ol d

Support:

Por meio da:

ENGIE logotype_gradient_BLUE_CMYK 14/04/2015

RÉFÉRENCES COULEUR

The brazilian market of distributed solar PV generation

2

Annual Report 2016

LEGAL NOTICE 1. All indications, data, and results in this study were compiled and carefully reviewed by the author(s).

Nevertheless, it is impossible to rule out mistakes in its content. Thus, neither Instituto IDEAL nor the author(s) can be held responsible for any claim, loss or direct or indirect damage that may occur because of the use of the information herein, or as a direct or indirect result of mistakes, imprecisions or omissions in the information herein.

2. Duplication or reproduction of all or part of the study (including transfer to data storage media) and distribution for non-commercial purposes is permitted, provided due credit is given to instituto ideal as the source of the information.

Other commercial uses, including duplication, reproduction, or distribution of all or part of this study, require previous written consent from Instituto ideal.

EDITORIAL STAFF COORDINATION: Peter Krenz (GIZ) and Philipp Hahn (AHK-RJ) EXECUTION: Taynara Reisner MighelĂŁo and Ana Carolina Richard EDITING: Paula Scheidt Manoel and Ricardo RĂźther COMMUNICATION OFFICER: Andressa Braun Graphic design and layouT: Andrezza Nascimento

THE BRAZILIAN MARKET OF DISTRIBUTED SOLAR PV GENERATION Annual Report

2016

G O L D S PO N S ORS HIP

ENGIE logotype_gradient_BLUE_CMYK 14/04/2015 24, rue Salomon de Rothschild - 92288 Suresnes - FRANCE Tél. : +33 (0)1 57 32 87 00 / Fax : +33 (0)1 57 32 87 87 Web : www.carrenoir.com

RÉFÉRENCES COULEUR

Zone de protection 1 C100%

Zone de protection 2 Zone de protection 3

S ILVER S PO N S ORS HIP

energias renováveis

The brazilian market of distributed solar PV generation

4

Annual Report 2016

Instituto Ideal Instituto Ideal is a private, not-for-profit organization based in Florianรณpolis (SC) that promotes renewable energies and energy integration policies in Latin America.

IDEAL works in three main areas: the Eco-Lรณgicas competition, the Energia + Limpa Seminar and the America do Sol program. All of them involve a series of initiatives that are free of charge to the participants.

By promoting events and providing incentives to studies and actions aimed at developing clean energies, IDEAL has strengthened its role as a link between government and the academic and business sectors, and has become a reference for the energy sector. The search for a diversified and integrated energy mix throughout Latin America has set the path for this Brazilian organization.

Learn more at institutoideal.org.

AHK-RJ Founded 100 years ago, the Brazil-Germany Chamber of Commerce and Industry in Rio de Janeiro (AHK-RJ) is a member of a global network of about 130 binational chambers in over 90 countries. In Brazil, it has 1,300 members and is an important link between the Brazilian and the German markets, enabling wide access to information and contacts, business intermediation and technology transfer between the two countries. In addition, it is a business and networking platform for its members in Brazil, as it also fosters business relations within the domestic market by means of its representativeness, visibility, services, and the general environment it facilitates.

Lear more at ahkbusiness.de.

The brazilian market of distributed solar PV generation

6

Annual Report 2016

FOREWORD ENGIE In 2016, ENGIE, the largest independent energy producer in the world, is now present on the Brazilian distributed generation market. In the context of energy transition the ENGIE group looks for, distributed generation is one of the main tools for future diversification of the energy mix. Therefore, studies such as this one are indispensable to popularize solar energy and its benefits, and help disseminate the technology that has gradually gained acceptance in Brazil.

Rodrigo Kimura Director of Operations

Intersolar South America Solar energy is expanding in Latin America. Market specialists expect its implementation to double in 2016. In line with Intersolar’s efforts, this market report published

by Instituto IDEAL and the Brazil-Germany Chamber of Commerce and Industry (AHK-RJ) discloses first-hand important data on this market and clearly contributes to the development of the photovoltaic energy sector in Brazil and in Latin America as a whole. Enjoy reading it, make sure you attend the next Intersolar South America meeting and take full advantage of this network.

Dr. Florian Wessendorf Solar Promotion Administrative Director International GmbH

The brazilian market of distributed solar PV generation

7

Annual Report 2016

Renovigi Renovigi has been on the photovoltaic energy market since 2012. To its over 700 partner companies throughout Brazil it supplies, in addition to tier one products on the global market, free-of-charge training and technical support.

Despite the increase in the number of connected PV systems in 2016, this market still falls short of ANEEL’s expectations. To Renovigi, supporting this study is a very important honor, as it ensures, in a transparent and impartial way, the quality of results that are used for corporate and governmental decision-making.

Alcione Belache Managing Partner

SICES Brasil SICES Brasil, of Italian origin, pioneers distributed generation in Brazil with transparency and excellence. These pillars strengthen the company, allowing it to follow a successful pathway. SICES Brasil unceasingly contributes to the dissemination of solar energy through social actions by sponsoring events and studies in this area. Today, as the sponsor of this study, SICES Brasil is proud of being a part of this outstanding project and of having chosen this beautiful country as its second home.

Jackson Chirollo COO SICES Brasil Director of Operations and Expansion

The brazilian market of distributed solar PV generation

8

Annual Report 2016

TABLE OF CONTENTS

Introduction 14 Methodology 16 Where do Companies fit in the PV value chain? 18 Profile of installers 20 Duration of the connection process 29 Socio-economic profile 32 Jobs in the Brazilian photovoltaic industry 33 Domestic prices 36 Relationship with the distributor companies 43 Standards and procedures 44 Challenges in the grid-connection process 53 Positive examples from distributors, general comments and suggestions 62 Comments and Suggestions 65 Final Considerations 68 Bibliographic references 73

The brazilian market of distributed solar PV generation

9

Annual Report 2016

LIST OF CHARTS

Chart 1 With which step of the value chain is your company involved? 19 Chart 2 How many photovoltaic (PV) systems installed by your company were connected to the grid in 2015 in the framework of REN 482/2012? 22 Chart 3 Electricity rate versus cost of PV distributed generation 23 Chart 4 Development of distributed generation in the Brazilian states at the end of 2015 (ANEEL, 2016) 25 Chart 5 Distribution of micro and mini-generators by consumption class at the end of 2015 (CASTRO, 2016) 26 Chart 6 Micro and mini-generator power ranges (CASTRO, 2016) 26 Chart 7 Map of grid-connected PV systems available on the América do Sol website 28

The brazilian market of distributed solar PV generation

10

Annual Report 2016

Chart 8 Time for completing all stages of installation and connection 30 Chart 9 Comparison of the time to complete all stages of installation and connection in the three surveyed years 31 Chart 10 Percentage of staffers and outsourced workers in the industry 34 Chart 11 Prices of PV systems in 2015 by power range as informed by installer companies 37 Chart 12 Prices of PV systems in 2015 by power range as informed by module and/or inverter manufacturer/retailer companies 38 Chart 13 Comparisons between PV systems prices by power range as informed by installer and module and/or inverter manufacturer/retailer companies 39

The brazilian market of distributed solar PV generation

11

Annual Report 2016

Chart 14 Price distribution of PV systems with power below or equal to 5kWp (turnkey) informed by installer companies 40 Chart 15 Structure of PV systems total installation cost 41 Chart 16 Company assessment of own knowledge of Section 3.7 of Module 3 PRODIST – ANEEL 45 Chart 17 Company assessment of own knowledge of standards for connecting to the distribution utility grid 46 Chart 18 Company assessment of how clear is Section 3.7 of Module 3 of the ANEEL distribution procedures (PRODIST) 47 Chart 19 Company assessment regarding how clearly they understand the rules for connecting to the distribution company grid 48 Chart 20 Do distributors update their standards when ANEEL and INMETRO make changes concerning mini and micro-photovoltaic generation? 49

The brazilian market of distributed solar PV generation

12

Annual Report 2016

Chart 21 Do distributor company standards include deadlines for each step of the grid-connection approval process according to what is established by the ANEEL REN 482/2012 (in Section 3.7 of Module 3 PRODIST)? 50 Chart 22 Level of satisfaction with distributor company standard 51 Chart 23 Level of satisfaction with the way distributor companies conduct the process 52 Chart 24 Did your company face any difficulties or requirements that hindered, delayed, or made nonviable the installation of a photovoltaic mini or micro-generator for one of your customers? 55 Chart 25 In which phase of the project did this happen?

If you faced this kind of difficulties at different stages, you can tick more than one option 56 Chart 26 Did the difficulties cause a delay in the deadlines stipulated by REN482/2012 (in PRODIST) for connecting the PV system to the grid? 57

Chart 27 Average delay to complete installation of the PV system due to difficulties 58 Chart 28 Did these difficulties prevent any projects from being connected to the grid? 59 Chart 29 Which points could be improved in the process of requesting a distributor to connect a photovoltaic system to the grid? 60 Chart 30 Which positive points of the distributor(s) would serve as examples to others? 64

The brazilian market of distributed solar PV generation

14

Annual Report 2016

INTRODUCTION The share of photovoltaic solar energy (PV) generation in the Brazilian, as well as the global, energy mix grows year after year. A series of factors account for this development, among which are the modularity of this technology, which fits the urban environment perfectly; the declining prices of PV over the last years; and this source’s low impact on global warming.

The Brazilian Electricity Regulatory Agency (ANEEL) has established an energy compensation system, internationally known as net metering, that has contributed since 2012 to the development of the PV solar energy sector in the country. This system allows the owner of a renewable source generator of up to 5 MW to feed back into the grid the power not consumed at the time of generation, receiving credits (in kWh) for it in his electricity bill. The amount this consumer pays monthly is then only the difference between the power drawn from the public grid and the power the PV system generates. This benefit was implemented

by ANEEL’s Resolução Normativa (REN) 482/2012, improved by Resolução Normativa (REN) 687/2015, which was incorporated into REN 482, in force since March 2016. Among the changes that took effect this year are the increases in generator maximum power (from 1 MW to 5 MW) and the expiration date of the credits granted (from 36 to 60 months).

The brazilian market of distributed solar PV generation

15

Annual Report 2016

Until August 2016, 21 Brazilian states adopted the exemption of the ICMS state tax (sales tax) on the power surplus generated by distributed generation systems, following the adoption of ICMS Agreement 16/2015 of the Conselho Nacional de Política Fazendária - Confaz. Under this agreement, this tax is levied only on the power consumers receive from the grid, not on the power that is generated and injected into the grid (MME, 2016).

Instituto IDEAL has monitored the Brazilian PV sector, disseminating information and encouraging the use of PV energy since 2010 through its América do Sol Program.

In this program’s framework, a digital knowledge platform was established that includes tools and actions with different players: power consumers, PV system owners, installers, designers, manufacturers, retailers, non-profit institutions, among others.

An integral part of the América do Sol program, “The Brazilian Distributed Photovoltaic Generation Market - 2016” survey now publishes its third edition. This study aims at documenting, monitoring, and offering suggestions to the PV distributed generation sector in Brazil. As this survey covers 2015, data collected still concern the market as it was before the changes ANEEL introduced in REN 482/2012 by adopting REN 687/2015.

This study preliminary data were published in Intersolar South America, held in August 2016 in the City of Sao Paulo.

The brazilian market of distributed solar PV generation

16

Annual Report 2016

METHODOLOGY To gather the data found in this survey, e-questionnaires were sent in June 2016 to 1,161 companies with an active profile on the AmÊrica do Sol Program’s Map of Companies in the Photovoltaic Sector (www.americadosol. org/fornecedores). The questionnaire remained available for response for 34 days. Of all the companies to which it was sent, 604 (52%) started to answer and 323 (28%) answered all the questions. Only answers from companies who completed the entire questionnaire were valid for this study.

Each year the questionnaire is improved in order to make questions clearer and meet the demands arising from the Brazilian market development. However, most questions are the same so data can be compared with those from previous editions, thus establishing trends in the Brazilian photovoltaic market development.

For the previous edition, all respondent companies accessed the same questions. This time, access to questions was segmented according to each company’s role in the PV solar energy value chain (equipment installer, designer, or manufacturer/retailer), which respondents informed upon starting to answer the questions. From data segmented for different market players, it is possible to draw a more complete picture of the Brazilian distributed solar generation market.

The brazilian market of distributed solar PV generation

17

Annual Report 2016

When interpreting data, we aimed at comparing and understanding the market reality in each one of the three years for which the study has been conducted. Year after year, the outcome of the survey is consolidated due to an increase in the number of respondents, pointing to a scenario in which there is a steady growth trend. Such analyses are important so the market can understand this sector’s evolution and restructure itself in order to become increasingly solid.

Where do Companies fit in the PV value chain?

The brazilian market of distributed solar PV generation

19

Annual Report 2016

Prior to answering the questionnaire, companies were required to point out the step of the value chain they were involved with. The three profiles companies could choose from were “Installer” of photovoltaic systems, “Manufacturer/retailer of PV modules and/or inverters” and “Designer”. Almost half (47%) of the 323 respondent companies stated they were installers; 35%, designers; and a minority (18%), manufacturers/retailers of PV modules and/or inverters.

Chart 1

With which step of the value chain is your company involved?

47% 35%

Installer Manufacturer / retailer of PV modules and/or inverters

18%

Designer

N = 323

“N” is the number of companies having answered each question.

PROFILE OF INSTALLERS

The brazilian market of distributed solar PV generation

21

Annual Report 2016

Companies that ticked the option “Installer” in the first question were directed to the following question: “How many photovoltaic systems (PV) installed by your company were connected to the grid in 2015 in the REN 482/2012 framework?” Only those having answered positively to this question could access this section of the survey, whose goal was to collect specific data on the work of Brazilian PV installer companies, such as number of installed projects and average installation time in 2015.

The vast majority of installer companies (74%) stated they had executed at least one project in 2015 in the framework of REN 482/2012. This data shows a positive trend compared to the other surveyed years. In the previous editions, the majority of respondents (59% in 2014 and 57% in 2015) had not connected PV micro or mini-generation systems to the grid. It is important to stress that all respondents answered this question in the previous editions.

The brazilian market of distributed solar PV generation

22

Annual Report 2016

Chart 2

How many photovoltaic (PV) systems installed by your company were connected to the grid in 2015 in the framework of REN 482/2012?

74% with projects 13%

13%

5%

NUMBER OF PROJECTS

0

24%

19%

1 2 3

26%

without projects

4 More than 4

N = 150

Approximately three-fourths (74%) of the 150 installer companies that answered this question stated they had completed at least one grid-connected PV project in 2015. 29% of the companies said they had installed at least four grid-connected PV systems. Therefore, we have a median1 of three executed and grid-connected projects by company. The maximum number, mentioned by only one company, was 60 projects.

1  The median is the number at the center of a group of numbers; i.e., half the numbers are above the median, and the other half, below.

The brazilian market of distributed solar PV generation

23

Annual Report 2016

Despite the difference in the questionnaire relative to previous editions of this survey, the median increase in the number of projects executed by company points to a greater maturity of the Brazilian PV sector. Installers who were newcomers in this sector acquired experience and added it to their organizational learning.

Moreover, the increase of over 35% in electricity rates in 2015 made PV micro and mini-generation financially feasible for end consumers in most Brazilian states (FOLHA DE SĂƒO PAULO newspaper, 2015).

Chart 3

Electricity rate versus cost of PV distributed generation 300,00

200,00 150,00 100,00 50,00 0,00 CF CH LO CE E S H M P ID IG RO -D P AM AN P E F LA LJ CE C L EL PA EL FS EK M TR LI O G M H U T XE N EE ER B AE GIA S SU -SU LG L IP E EM IE E S N TO ER G ED IA EV CE P LE RG SC E CE -DI B- S D EL IS ET RO EP AC B CP RE FL -P ES au E lis ta CE CO A EL L CP CO BA FL SER -J N ag ua C ri Bo ER a R Vi st a

US$MWh

250,00

Red flag Final rate with no flag Levelized cost of PV distributed generation Note: calculation for October, 2015.

Source: EPE, 2016 (Adapted by the authors)

The brazilian market of distributed solar PV generation

24

Annual Report 2016

We should also stress that, with more information available to end consumers, both private persons and companies, PV electricity is no longer a novelty in Brazil and is further consolidated.

In late 2015, 1,788 photovoltaic systems connected under the REN 482/2012 rules were registered, with 13.4 MW (ANEEL, 2016 apud EPE, 2016). The number of distributed generation installations tripled between 2014 and 2015. In October-December 2015 alone, the number of PV micro and mini-generators went from 1,148 up to 1,788, which corresponds to a growth of around 64% (ANEEL, 2016). The highest growth rates are found in Minas Gerais, Rio de Janeiro, and Rio Grande do Sul states.

The brazilian market of distributed solar PV generation

25

Annual Report 2016

Chart 4

Development of distributed generation in the Brazilian states at the end of 2015 (ANEEL, 2016)) Number of connections 0

50

100

150

200

MG

300

350 333

203

RJ

186 182

RS SP

142 127

PR CE

121

SC MS

100 65

PE

Brazilian state

250

56

BA

49

RN

38

DF ES

24

MA

23 20

TO

18 16

PB GO PA

10

PI

9

AL

3

AM MT

2 2

AC

1

RO

1

Source: Adapted from ANEEL, 2015

SURVEY DATE

Oct/2015 Jan/2016

The brazilian market of distributed solar PV generation

26

Annual Report 2016

Chart 5

Distribution of micro and mini-generators by consumption class at the end of 2015 (CASTRO, 2016) 1%

2% 2%

CONSUMPTION CLASS

7%

Commercial Residential

16%

Industrial Rural Public administration Group A

72% Source: Adapted from CASTRO, 2016

Chart 6

Micro and mini-generator power ranges (CASTRO, 2016 1% 1%

0,4%

6% POWER RANGES IN kW

11% 13% 42% 25%

Source: Adapted from CASTRO, 2016

1

3

5

10

50

100

500

1000

The brazilian market of distributed solar PV generation

27

Annual Report 2016

The power of the vast majority (73%) of micro and mini-generators installed before the end of 2015 is lower than or equal to 5 kW. In addition, the majority of installations concerned the residential rate group (72%), followed by the commercial rate group (16%), as per the ANEEL survey (CASTRO, 2016). This shows which market niche has developed the most in the last years, mainly a consequence of the above-mentioned electricity rate increases, , as well as of the fact that residential tariffs are the highest in the country.

In Germany, a reference in PV solar energy development and deployment, 47,000 PV systems were installed in 2015 (Fraunhofer ISE, 2016). There are more than 1,5 million grid-connected PV systems in Germany, where most PV power plants in operation are also installed in homes and the higher power range is consolidated between 10 and 100kWp, with an average level of 30,1kWp in 2015 (Fraunhofer ISE, 2016a).

The average power level is higher than in Brazil for two main reasons. The first one is that Germany receives lower solar irradiation, which creates the need for higher PV system power to generate the same amount of energy as in Brazil. The second reason is that in Germany it is possible to sell surplus power to the grid, which is not the case in Brazil.

The brazilian market of distributed solar PV generation

Annual Report 2016

28

Chart 7

Map of grid-connected PV systems available on the América do Sol website RR

AP

AM

PA

CE

MA PI

AC

TO

RO

BA

MT DF

NUMBER OF PV SYSTEMS

0

GO MG

ES

MS SP

RN PB PE AL SE

RJ

PR SC RS

1 to 54 55 to 257 258 to 475 476 to 615 More than 615

Source: Solar Brasil Network - América do Sol (2016)

In August 2016, Brazil had 5,040 micro and mini-generator units, accounting for an installed power generation capacity of 47,934 kW (ANEEL, 2016). The vast majority (78%) of consumers are residential, with a higher regional concentration (23.5%) in the state of Minas Gerais (ANEEL, 2016b). The current installed photovoltaic power generation capacity in Brazil is 57.5 MW (IDEAL, 2016). Power generation by consumers tends to grow and should reach 1.2 million consumer units in Brazil before 2024 (Procel Info, 2016). With Solar Brasil Network, a tool in América do Sol program, it is possible to visualize the current situation of PV systems operating in Brazil, as per the ANEEL BIG - Banco de Informação de Geração (Generation Information Database) (Chart 7).

The brazilian market of distributed solar PV generation

29

Annual Report 2016

In other Latin-American countries, regulating a net metering system is now also considered crucial for the expansion of the PV distributed generation market. At the end of 2015, Mexico had an installed power generation capacity in excess of 100 MW in the net metering scheme, 73% of which in the residential sector. The Dominican Republic and Panama also stand out for the growth of their PV solar energy decentralized market based on the net metering system. Costa Rica adopted in April of this year the rules for electricity self-consumption and compensation.

DURATION OF THE CONNECTION PROCESS Section 3.7 of Module 3 of the Distribution Procedures (PRODIST), linked to REN 482/2012, in force during 2015, establishes that the maximum period for distributors to carry out their activities concerning micro-generation is 82 days (since 1st March 2016 this maximum period was reduced to 34 days, but for the period considered in this study, 82 days was the maximum). These 82 days encompass time limits set for obtaining grid access permission, inspecting the installation, submitting the inspection report, obtaining approval, and establishing the connection (ANEEL, 2012). In order to assess this issue, we asked participants a question concerning the average time required for completing all stages of the installation of a grid-connected photovoltaic system –from the signature of the contract between the company and the customer to the approval by the distributor and actual connection of the system to the grid2. Among the 111 answers, the low2  In the case of mini generation and if there is work to be done on the distribution grid, the maximum time allowed is 112 days.

The brazilian market of distributed solar PV generation

30

Annual Report 2016

er number reported was one month, and the largest, 12 months or more. Chart 8 illustrates the average answers for the three surveyed years.

Chart 8

Time for completing all stages of installation and connection Avg. time in months

8 6 4 2 0 2013

2014

N = 36

N = 49

2015 Year

N = 111

The above chart shows a reduction throughout the years of the average time for completing all stages of installation and connection. The average in 2015 is three months and three weeks, a month less than the average for the previous year. This reduction shows that processes are more agile, which result in benefits in terms of the economic viability of PV micro and mini-generators. It is important to highlight that this year the number of respondents is higher, and this increase from year to year makes data more and more consolidated.

Chart 9 shows the distribution. There is a clear decrease in the number of companies reporting five or more months to completion. In 2015, only two companies stated it had taken nine or more months.

The brazilian market of distributed solar PV generation

31

Annual Report 2016

This number is bound to decrease every year, as it is far from what the revised version of ANEEL’s REN 482/2012 (REN 687/2015) stipulates: 34 days for micro-generators.

As far as mini-generation is concerned, the deadline was reduced to 49 days in Brazil. If there is a need for works on the grid, the deadline for obtaining grid access permission is extended for 15 days for micro-generation and for 30 days for mini-generation, which makes the total time period for this process longer (ANEEL, 2015).

The mean period required for completing PV projects of the same power scale in the European market is about 3060 days (IDEAL, 2014).

Chart 9

Comparison of the time to complete all stages of installation and connection in the three surveyed years 35% YEAR

Percentage of answers

30%

2013

25%

2014

20%

2015

15% 10% 5% 0% 1

2

3

4

5

6 7 8 Months

9

10 11 12

SOCIO-ECONOMIC PROFILE

The brazilian market of distributed solar PV generation

33

Annual Report 2016

This section outlines companies’ socio-economic profile, capturing data about job generation in this sector and analyzing installed system prices, as well as the total cost structure of a PV installation.

Companies that stated in the first question that they are “Installers” and “Manufacturers/retailers of PV modules and/or inverters” answered the questions in this section (Chart 1).

JOBS IN THE BRAZILIAN PHOTOVOLTAIC INDUSTRY Of the total number of professionals hired in 2015, 59% were outsourced3. There was a small increase in the number of staffers4 relative to 2014, when outsourced employees were 63% of the total. This can be a sign either of market seasonality or of the wide area where companies work.

Companies providing services in locations far away from their headquarters might choose to hire local outsourced labor in order to reduce their costs.

3 Outsourced employees are those who do work for the company but are not on its payroll.

These include service providers and contingency workers.

4 Staffers are employees with whom the employer signs an employment contract, after which they are on the payroll and entitled to all labor rights established by the Brazilian labor law (Consolidação das Leis do Trabalho - CLT).

The brazilian market of distributed solar PV generation

34

Annual Report 2016

Chart 10

Percentage of staffers and outsourced workers in the industry

41%

59%

Staffers

Outsourced employees N = 210

In absolute terms, the median number of outsourced employees in the 210 companies responding the questionnaire was three per company, and two staffers. Answering questions on hiring outsourced employees, 50% of the companies stated they had hired up to three, 26% stated they had hired four or more, and 24% did not hire any outsourced employees; the highest number reported was 54 new outsourced employees.

As to hiring staffers, 85% of the companies stated they had hired up to three; 30%, none, and 19% had hired four or more staffers; the highest number reported -by one single company- was 40 hired staffers.

When crossing the separate data for respondents who were “Installers” and “Manufacturers / retailers of PV modules and/or inverters”, it became apparent that the ratio of staffers versus outsourced employees is the same in both categories.

The brazilian market of distributed solar PV generation

35

Annual Report 2016

As a basis for comparison, countries with larger numbers of employees in the renewable energy industry are China, Brazil, United States, India, Japan, and Germany.

In Brazil, there are around 918,000 employees in this industry (IRENA, 2016). Photovoltaic generation is the number one global employer in manufacture, installation, operation, and maintenance, with 2.8 million employees (IRENA, 2016).

According to the Alvorada Report, published by the Greenpeace Institute – Brazil (2016), the prospect of job growth in the Brazilian PV industry is almost 700 thousand new jobs to be created by 2030, considering current conditions for the development of solar micro-generation in the country.

This study also analyzes an optimistic scenario, which it called “Better Brazil”, simulating a combination of incentives –such as the release of the Fundo de Garantia do Tempo de Serviço – FGTS (Government Severance Indemnity Fund), ICMS (sales tax) exemption, import tax exemption and PIS/COFINS taxes exemption- to assess the potential for the implementation of photovoltaic systems in a much more favorable scale. In this case, the number of new jobs would be almost four millions by 2030 (Greenpeace, 2016).

DOMESTIC PRICES Prices of PV system installations carried out in 2015 were surveyed for each nominal power range of installed capacity, separately for installer companies and for manufacturers/retailers of modules and/or inverters. We received

The brazilian market of distributed solar PV generation

36

Annual Report 2016

125 answers from installer companies concerning installations of up to 5kWp, indicating an average amount of R$8.58/Wp, slightly lower than in 2014, when the average informed price was R$8.81/Wp (IDEAL, 2015).

As expected, the higher the power range, the lower the average price, as overhead costs are fixed. Prices for power ranges of up to 5kWp, 5-30kWp, and 31-100kWp were lower than in 2014. On the other hand, the price for the power range above 100kWp increased slightly: from R$6.22/Wp in 2014 up to R$6.44/Wp in 2015.

A majority of respondents (57%) reported prices of R$7.00/Wp-R$9.00/Wp for up to 5kWp; 71% reported prices of R$7.00/Wp-R$9.00/Wp for 6-30kWp; and 78% of companies informed prices of R$6.00/Wp-R$8.00/Wp for 31-100kWp. For PV systems with power ranges above 100kWp, 69% of the respondents informed the previously mentioned price range, of R$6.00/Wp-R$8.00/Wp. Maximum prices for each power range were R$15.00/Wp (up to 5kWp), R$12.80/Wp (6-30kWp), R$9.70/Wp (31100kWp), and R$9.20/Wp (above 100kWp). All maximum prices for each power range were mentioned only once.

To analyze and check data, we compared the arithmetic mean and the median, finding minimum variation. Thus, we decided to use the arithmetic mean, as it is more widely known, as shown in charts 11, 12, and 13.

The brazilian market of distributed solar PV generation

37

Annual Report 2016

Chart 11

Prices of PV systems in 2015 by power range as informed by installer companies 16

Avg. price in R$/Wp

14 12 10

R$8,58

8

R$7,57

R$6,86

R$6,44

6 4 2

N1=125

N2=102

Up to 5

5 to 30

N3=85

N4=68

0 31 to 100 More than 100 System power in kWp N = number of respondents

The mean price calculated from the 47 answers from manufacturers and retailers of modules and/or inverters for the power range of up to 5kWp is R$8.42/Wp. For all power ranges, the mean price was slightly lower than the one informed by installer companies.

Maximum prices for each power range were R$15.30/Wp (up to 5kWp), R$13.40/Wp (6-30kWp), R$12.20/Wp (31100kWp), and R$8.70/Wp (above 100kWp). All maximum prices for each power range were mentioned only once.

The brazilian market of distributed solar PV generation

38

Annual Report 2016

A majority of respondents (59%) reported prices of R$7.00/Wp-R$9.00/Wp for up to 5k Wp; 56% reported prices of R$7.00/Wp-R$9.00/Wp for 6-30kWp; and 65% informed prices of R$6.00/Wp-R$8.00/Wp for 31100kWp. For PV systems above 100kWp, 75% informed prices of R$5.00/Wp-R$7.00/Wp.

Chart 12

Prices of PV systems in 2015 by power range as informed by module and/or inverter manufacturer/retailer companies 16 Avg. price in R$/Wp

14 12 10

R$8,42

8

R$7,40

R$6,64

R$6,14

6 4 2

N1=47

N2=44

Up to 5

5 to 30

N3=35

N4=29

0 31 to 100 More than 100 System power in kWp

The brazilian market of distributed solar PV generation

39

Annual Report 2016

Chart 13

Comparisons between PV systems prices by power range as informed by installer and module and/or inverter manufacturer/ retailer companies

Avg. price in R$/Wp

9.000

8.000

7.000

6.000

5.000 Up to 5 Retailer

5 to 30

31 to 100

More than 100

System power in kWp

Installer

Chart 13 shows that the prices of PV systems informed by installer companies are only slightly above those reported by module and/or inverter manufacturers.

Charts 14 and 15 show the distribution of average market prices for systems up to 5kWp charged by installers, manufacturers, and retailers of modules and/or inverters.

Chart 14 shows that the vast majority (94%) stated their price is R$6.00/Wp-R$11.90/Wp for PV systems with a power range of up to 5kWp.

The brazilian market of distributed solar PV generation

Annual Report 2016

40

Chart 14

Price distribution of PV systems with power below or equal to 5kWp (turnkey) informed by installer companies 36

Number of answers

26 20 16 8 3

N = 125

9

9

4,

5,

15

-1

9 14

-1

3,

9 2, 13

-1

9 1, 12

-1

9 11

-1

0,

,9 10

-1

-9

,9 9

,9

-8 8

-7

,9 7

-6

,9

0 0 1 6

-5

,9 5

,9

-4 4

-3

,9 3

-2 2

-1

,9

1 1 1 1 1

5 6

Price in R$/Wp

Taking into account only the universe of answers from equipment manufacturers and retailers, we can also see that the majority (87%) sells equipment for prices varying from R$6.00/Wp to R$10.90/Wp for PV micro-generators of up to 5kWp. The average price charged by manufacturers and retailers of modules and/or inverters for the power range of up to 5kWp is R$8.42/Wp. In contrast, with falling prices on the international market, prices informed in this survey edition are similar to last year’s, which reflect annual inflation and fluctuations in the US dollar exchange rate, as most components are usually imported.

The brazilian market of distributed solar PV generation

41

Annual Report 2016

Companies fitting one of these two profiles also informed prices per region where they work, but data variation was minimum and cannot be considered relevant or conclusive.

Companies were then asked about the price structure of components for PV installations.

Chart 15

Structure of PV systems total installation cost Other components (physical structure, installations and electrical protection, etc.)

Project and installation

PV modules

18%

42%

17% 23% Inverters

Number of respondents = 150

Based on the mean amounts calculated from the answers, the total cost structure of a PV installation is as follows: PV modules, 42%; inverters, 23%; design and installation, 17%; other components (including physical structure, installation, and electrical projections, etc.), 18%. There were no relevant variations relative to 2014 and, as expected, PV modules still are the most costly item in a PV installation.

The brazilian market of distributed solar PV generation

42

Annual Report 2016

PV module manufacturers usually offer a 25-year warranty to this equipment. Within this period, modules maximum nominal power can drop up to 20% according to international quality standards. It is important to stress that PV systems will still generate electricity after these 25 years with lower yields, with no need to invest in maintenance, just in cleaning. Inverters, on the other hand, usually have a 5-10 year warranty; their service life can be a little longer than this period (PINHO; GALDINO, 2014 apud EPE, 2016).

RELATIONSHIP WITH DISTRIBUTORS

The brazilian market of distributed solar PV generation

44

Annual Report 2016

This stage of the research aimed at understanding to what extent companies in the Brazilian PV sector perceive, are aware of, and are satisfied with existing standards and the process to apply for grid-connection of PV systems of both micro and mini-generation to Brazilian electricity distributors. Companies fitting one of the three profiles (Installers, Manufacturers and retailers of modules and/ or inverters, and designers) answered this section of the questionnaire (Chart 1).

Standards AND PROCEDURES As in the survey previous editions, respondent companies assessed their own awareness of Section 3.7 of Module 3 of ANEEL’s Distribution Procedures (PRODIST) and of distributor’s standards they dealt with in 2015.

The number of companies having informed they have a lot of knowledge about Section 3.7 of Module 3 of PRODIST increased from 29% in the previous edition up to 41% this year. The total number of companies stating they have a lot of or moderate knowledge is 89%.

The brazilian market of distributed solar PV generation

45

Annual Report 2016

Chart 16

Company assessment of own knowledge of Section 3.7 of Module 3 PRODIST – ANEEL 2% 9% 48% 41% No knowledge

A little knowledge

Moderate knowledge

A lot of knowledge

N = 322

Companies’ teams assessed to what extent they are aware of the distributor’s grid-connection standards. The number of those stating they have a lot of knowledge increased compared to last year, from 49% to 54%. This is one additional sign of the learning process the market as a whole is going through.

The brazilian market of distributed solar PV generation

46

Annual Report 2016

Chart 17

COMPANY ASSESSMENT OF OWN KNOWLEDGE OF STANDARDS FOR CONNECTING TO THE DISTRIBUTION UTILITY GRID 1% 7% 38% 54% No knowledge

A little knowledge

Moderate knowledge

A lot of knowledge

N = 322

This year, options for assessing how clear distributors, Section 3.7 of ANEEL’s Distribution Procedures Module 3 (PRODIST), and the distributors’ grid-connection standards are have been reformulated; answer options were redrafted so respondent companies could better understand them.

In 2014, respondents had to choose among “Not very clear”, “Some portions were not clear”, “Mostly clear”, or “Totally clear”. After redrafting, options now are “Not clear”, “Not very clear”, “Mostly clear”, and “Totally clear”.

Thus, respondents now can choose from options that cover all possible opinions.

As to how clear ANEEL’s standards for FV micro and mini-generators grid-connections, as per Section 3.7 of Module 3 - PRODIST, most installers (78%) are satisfied:

The brazilian market of distributed solar PV generation

47

Annual Report 2016

63% stated that Section 3.7 is mostly clear, and 15% find it totally clear (Chart 18). Thus, there is an increase in the number of those perceiving ANEEL’s standards as clear compared to last year, when 67% pointed out that they were “Mostly clear” and just 8%, “Totally clear”.

Only 21% of the companies stated that rules are “Not very clear” and just 1%, “Not clear at all”.

Chart 18

Company assessment of how clear is Section 3.7 of Module 3 of the ANEEL distribution procedures (PRODIST) 1% 15% 21%

Not clear Not very clear Mostly clear

63% N = 322

Totally clear

The brazilian market of distributed solar PV generation

48

Annual Report 2016

In 2015, there was a slight improvement relative to the 2014 numbers regarding the level of clarity of standards for connecting to the distributor grid. The percentage of companies stating that the standards is mostly clear increased from 54% in the previous edition up to 60%, whereas those stating it is totally clear went from 11% up to 20%.

Accordingly, the percentage of companies stating it is not very clear and not clear at all decreased from 35% down to only 20%. Thus, the level of installer understanding of standards does not seem to be a problem for the market.

Chart 19

Company assessment regarding how clearly they understand the rules for connecting to the distribution company grid 2%

20%

18%

Not clear Not very clear Mostly clear

60% N = 322

Totally clear

The brazilian market of distributed solar PV generation

49

Annual Report 2016

Distributors are supposed to update their standards every time ANEEL and INMETRO introduce changes in standards concerning mini and micro-generation; so, we asked companies if this actually happens.

While companies’ perception was that distributor standards updating upon changes in national regulation worsened from 2013 to 2014, this aspect has clearly improved in 2015. Out of the total number of companies interviewed for this edition, 75% stated that the standards are updated whenever ANEEL and INMETRO introduce changes.

Chart 20

Do distributors update their standards when ANEEL and INMETRO make changes concerning mini and micro-photovoltaic generation?

75% 61% 49%

YES 2013

2014

2015

N = 89

N = 106

N = 322

NO

25% 39%

51%

The brazilian market of distributed solar PV generation

50

Annual Report 2016

Chart 21

Do distributor company standards include deadlines for each step of the grid-connection approval process according to what is established by the ANEEL REN 482/2012 (in Section 3.7 of Module 3 PRODIST)?

Distributor standard DOES NOT establish any deadlines Distributor standard establishes deadlines ONLY FOR SOME steps Distributor standard establishes deadlines for ALL steps

9% 39% 52%

N = 322

Another important factor for installers are deadlines established by utilities for the connection process, as REN 482/2012 includes deadlines for the main steps of the procedure for requesting connection to the grid.

As to the question on whether the distributor standard includes deadlines for each step according to what was established by REN 482/2012 of ANEEL (in Section 3.7 of Module 3 PRODIST), there is a slight change in companies’ answers compared with those of the previous year.

While in the previous edition 58% stated that standards establish deadlines for all steps, this time this percentage is 52%. This year, 39% of the respondents informed deadlines are established only for a few steps of the procedure for requesting connection to the grid (Chart 21), a 6% increase relative to last year’s percentage (33%).

The brazilian market of distributed solar PV generation

51

Annual Report 2016

The percentage of companies having informed that the distributor standard does not establish deadlines is stable at 9%.

The installer satisfaction with the distribution utility’s standard in force in 2015 was evaluated based on a scale from one (dissatisfied) to five (very satisfied) stars. Overall, they tend to be satisfied, with values that are very similar to those of last year’s edition. The highest percentage of answers is clustered around the middle of the scale: 41% chose three stars; 31%, four stars; and 9%, the maximum five stars. Moreover, 21% mentioned some dissatisfaction choosing one (9%) or two (12%) stars (Chart 22). Compared to the last edition, the percentage of those choosing four stars increased from 23% up to 31%; on the other hand, the number of companies choosing five starts dropped from 17% down to just 9%.

Chart 22

Level of satisfaction with distributor company standard 7% 12% 41% 31% 9% N = 322

The brazilian market of distributed solar PV generation

52

Annual Report 2016

The process for requesting connection to the distributor’s grid is still a source of dissatisfaction: 42% of companies chose one or two stars (very dissatisfied and dissatisfied).

This number is better than last year’s, when this total was 57%, but it still is high. Only 5% of respondent companies gave five stars and 20%, four stars. The higher percentage went to three stars: 33%.

Chart 23

Level of satisfaction with the way distributor companies conduct the process 19% 23% 33% 20% 5% N = 321

CHALLENGES IN THE GRID-CONNECTION PROCESS

The brazilian market of distributed solar PV generation

54

Annual Report 2016

Difficulties with the process of requesting connection to the grid, such as delays, can be minimized by raising awareness about how relationships between installers, end consumers, and distributors play out. In this chapter, we analyze in detail difficulties facing installer companies in 2015 in their relationship with distributors before REN 687/2015, revising REN 482/2012, came into force in order to contribute to the sustainable development of the Brazilian distributed generation market. Moreover, installer companies could contribute their perceptions as to what distributors do to improve the process of requesting connection to the grid.

The only installer companies that answered this question were those who answered ‘yes’ to the following question: “Did your company face any difficulties or requirements that hindered, delayed, increased the cost of or made nonviable the installation of a PV mini or micro-generator for any of your customers?” (Chart 24).

The brazilian market of distributed solar PV generation

55

Annual Report 2016

Chart 24

Did your company face any difficulties or requirements that hindered, delayed, or made nonviable the installation of a photovoltaic mini or micro-generator for one of your customers?

63% 37%

N = 151

The percentage of companies having stated they had difficulties decreased compared to the previous year, from 75% in 2014 down to 63% in 2015, which is similar to 2013, when 64% of the answers were positive.

These companies were then asked in which phase of the implementation of a grid-connected PV system project they faced greater difficulties. Respondents were allowed to tick more than one option.

Chart 25 shows that the “Grid access permission request� step still is the one during which installer companies face the most difficulties.

The brazilian market of distributed solar PV generation

56

Annual Report 2016

Chart 25

In which phase of the project did this happen?

If you faced this kind of difficulties at different stages, you can tick more than one option 34 10 13 2

7

55 69

N = 190

Project planning

Grid access permission application

Signature of Operational Relationship agreement between the client and the distributor

PV system installation

PV system commissioning

PV system operation

Billing (electricity bill)

The step for which the number of ticks increased the most was “Billing (electricity bill)�, which this year is the second most mentioned answer. This is possibly the case because many installers only reached this stage in 2015. In addition, adjustments in electricity rates and changes introduced by a few states in the ICMS tax on the power generated were implemented during 2015, making it difficult for

The brazilian market of distributed solar PV generation

57

Annual Report 2016

consumers to understand their electricity bill after installing a PV system. It is important to stress that ICMS tax exemption (CONFAZ Agreement 16/2015) is autonomously granted by each Brazilian state Finance Department, not by the Regulatory Agency.

As in the previous edition, the installation of the PV system was the least often chosen answer. There was minimum variation in the other options.

Installer companies were asked whether these difficulties had caused delays in the deadlines stipulated by REN482/2012 (in PRODIST) for connecting the PV system to the grid. The majority (89%) stated they had faced delays. This number is similar to the one in the 2013 survey, which was 90%, and slightly higher than the one for 2014 (82%).

Chart 26

Did the difficulties cause a delay in the deadlines stipulated by REN482/2012 (in PRODIST) for connecting the PV system to the grid?

89% 11% N = 95

The brazilian market of distributed solar PV generation

58

Annual Report 2016

When asked about how long this delay was, respondents mentioned shorter delays than in 2014. Chart 27 shows that only 39% of the companies stated the delay was three months or more. In 2014, this percentage was 62%. A minority (4%) had no expected completion time, whereas in 2014 this percentage was 2%.

Chart 27

Average delay to complete installation of the PV system due to difficulties 16% 20% 8% 7% 4%

45%

N = 85

Up to 01 month

2 months

3 months

4 months

More than 4 months

No expected completion time

The brazilian market of distributed solar PV generation

59

Annual Report 2016

Despite the delays, a vast majority of projects were completed. Only 26% of the companies stated they were not able to complete the grid-connection process due to difficulties during this period. In 2014, this percentage was 35% and in 2013, 38%, which is a sign of a positive market development.

Chart 28

Did these difficulties prevent any projects from being connected to the grid?

26% 74% N = 95

In order to understand how to mitigate these difficulties, companies were asked to point out aspects that could be improved in the process of requesting distributors to connect a photovoltaic system to the grid.

The chart below shows the eleven options respondents had and their answer distribution. Companies were allowed to tick more than one option.

The brazilian market of distributed solar PV generation

60

Annual Report 2016

Chart 29

Which points could be improved in the process of requesting a distributor to connect a photovoltaic system to the grid?

F

Compliance with deadlines stipulated

by REN 482/2012 (within PRODIST) of ANEEL

71

A

Standardization of disclosure on grid connection procedures for all distributors

69

H

Acceptance two unidirectional meters for low voltage customers

66

E

A copy of the answers on the review of documentation is also sent to installers managing the project, not only to consumers

65

B

Simplification of the stages of grid-connection application process

64

I

Clear identification of credits and kWh generated by the client in the energy bill (electricity bill)

D

More direct access to the grid connection standard on the distributor's site

G

Bidirectional meters should be available from the distributor stock to streamline the replacement

K

There is no need for improvement

J

Energy bill standardization, and dissemination of its model on the distributor's website

C

Specific training on distributed generation to distributor branch clerks to improve customer service

73

61 48 36 19 1 N = 573

The brazilian market of distributed solar PV generation

61

Annual Report 2016

The three points most often mentioned were: “Compliance with deadlines stipulated by REN 482/2012 (within PRODIST) of ANEEL (F)”, with 73 answers (or 13% of the total); “Standardization of disclosure on grid connection procedures for all distributors (A)”, with 71 answers (12%); and “Acceptance of two unidirectional meters for low voltage customers (H)”, with 69 answers (12%).

In the previous edition, the most often chosen options were: A (Standardization of disclosure on grid connection procedures for all distributors); B (Simplification of the stages of grid-connection application process); C (Specific training on distributed generation to distributor branch clerks to improve customer service); and F (Compliance with deadlines stipulated by REN 482/2012 (within PRODIST) of ANEEL). In the current edition, option “C” was ticked only once. This can be a sign of a better distributor customer service.

It is worth mentioning that, with the changes made to regulations through REN 687/2015, aspects related to the energy bill will garner more attention from distributors in the course of 2016. Therefore, it is to be expected that, in the 2017 edition of this survey, there will be a lower number of complaints regarding this topic.

POSITIVE EXAMPLES FROM DISTRIBUTORS, GENERAL COMMENTS AND SUGGESTIONS

The brazilian market of distributed solar PV generation

63

Annual Report 2016

At this stage, respondents were asked to give positive distributor examples. In addition, they were also able to leave comments on the study or the market. All companies in the survey answered questions in this section.

The graph below shows the options available to respondents and the number of answers we received. Companies were allowed to tick more than one option.

While the total of answers increased from 237 to 764, the result in this edition remained quite similar to that of last edition, with the three most chosen points being the same as in 2014: “The distributor’s norms comply with PRODIST” (D); “The team treats mini and micro generation positively” (B); and “The team is considerate and open to suggestions” (A).

The “The distributor uses a low-cost meter with good technology” (G) option was more often chosen than in the previous edition, which is a sign that distributors are now better prepared to serve this market than in the previous years.

F (Billing is handled properly) still is the least often chosen option, stressing what was pointed out above, i.e.: this is a point that deserves greater attention from distributors.

The brazilian market of distributed solar PV generation

64

Annual Report 2016

Chart 30

Which positive points of the distributor(s) would serve as examples to others?

162 158 123 88 82 74 55 22 N = 764

D

Distributor standards comply with PRODIST

B

The team treats mini and micro-generation positively

A

The team is considerate and open to suggestions

C

Distributor complies with deadlines

E

Distributor standards are detailed and thorough

G

Distributor uses a low cost and good technology meter

F

Billing is correct

H

Others

The brazilian market of distributed solar PV generation

65

Annual Report 2016

COMMENTS AND SUGGESTIONS Globally, comments were very similar to those in the previous edition. However, they are now less numerous and a few complaints are no longer mentioned, such as issues related to INMETRO certification and labeling.

Other respondent considerations do not concern their relationship with the distributor itself, but are rather relevant to every new market. Therefore, they tend to continue to come up until the market reaches maturity; this is the case of the lack of adequate funding lines.

Distributor procedure and preparedness Many comments concern distributors’ lack of preparedness for the grid- connection process and the scarcity of professionals in this area. A number of companies reported difficulties talking to this sector through the Call Center or by email. Another very frequently mentioned aspect is the lack of compliance with deadlines established

by REN 482/2012, mainly in the meter replacement step.

One respondent pointed, “The distributor is not properly organized for meter replacement, as it does not have enough bidirectional meters in stock to cope even with the still small number of new connections to the grid, thus extending replacement time.� In addition, one respondent commented that requesting an access report for rural properties is difficult.

The brazilian market of distributed solar PV generation

66

Annual Report 2016

Online process As mentioned in the previous survey, some respondents requested that documents be accepted by e-mail and that there is an online monitoring of this process.

It is important to note that, pursuant to REN 687/2015, distributors must provide, as of January 2017, an electronic system through which consumers can send access requests and all documents listed in the annexes of Section 3.7 of Module 3 of PRODIST and monitor each step of the process online (ANEEL, 2015a).

Funding As in the previous survey, a number of respondents indicated the need for financial agents to develop a credit line specifically targeting the distributed generation market.

Fees and Taxes A few Brazilian states have already adopted ICMS tax exemption for distributed generation (ICMS Agreement No. 16/2015). One respondent said that her state’s government is still levying the ICMS tax, which, in her opinion, makes it difficult to sell PV systems.

The brazilian market of distributed solar PV generation

67

Annual Report 2016

It is not up to ANEEL to make decisions concerning Federal and State tax and fee levying, but rather to the Brazilian Revenue Service (Receita Federal) and State Finance Departments. The ICMS tax (sales tax) is a State tax levied on electrical energy (ANEEL, 2016a). “In the case of States having not adhered to the new Agreement, the previous rule applies, pursuant to which the ICMS tax is levied on the whole consumption, thus disregarding energy injected into the grid by micro or mini-generation� (ANEEL, 2016a). Pursuant to Law 13169/2015, PIS / PASEP and Cofins taxes are not levied on electrical energy from distributed generation.

FINAL CONSIDERATIONS

The brazilian market of distributed solar PV generation

69

Annual Report 2016

Data obtained in this edition of the survey “The Brazilian photovoltaic distributed generation market - Year 2016” point to an evolution of this industry from year to year. Although 26% of the respondent installers still stated they are new to the market and have not yet executed any projects, for the first time a majority of companies reported having installed PV micro and mini generation systems in 2015. The average number of projects installed per company is larger than in previous years, with three projects per year in 2015. This shows that these companies are gaining knowledge and experience with each new installation, and that consumers’ demand for PV distributed generation solutions increased, which also led to job creation, with the PV energy sector employing a growing number of workers. The number of companies registered with the América do Sol program virtually doubled every year and, as analyzes show, the number of new employees followed this same trend. This year, there is an increase in the number of staffers hired, which point to a certain stability in this industry due to higher sales levels. Companies are already more confident, consolidated, and ready to hire staffers instead of seasonal employees.

Another relevant point is the decrease in connection time reported in the survey, which went from four months and three weeks in 2014 to three months and three weeks in 2015, one month shorter. This reduction is in line with a trend that has been consistent since the survey’s first edition, which shows that this industry is on a learning curve, a process that involves all the different players in this sector in Brazil.

The brazilian market of distributed solar PV generation

70

Annual Report 2016

At the same time, difficulties with PV system grid-connection process are still a challenge to be overcome. These difficulties lead to an increase in total time to complete installations, delay which most respondents state is two months in average. Therefore, lack of compliance with the deadlines by distributors is still one of the main causes of installer dissatisfaction. Installers stress that requesting grid access permission and billing are the steps in which they face more difficulties.

It is important to note that distributors still need to adapt to ANEEL’s new REN 687/2015, which only entered into force in March 2016 and therefore was not considered in this survey. The new norm changed a few important points in REN 482/2012, which should help reduce complaints and make the process more agile. This is the case of the stipulation of deadlines for the different steps of grid-connection requesting and the mandatory inclusion of a number of data on distributed generation consumer’s energy bill.

Domestic prices charged by installer companies fell slightly from R$8.81 / Wp in 2014 to R$8.58 / Wp in 2015 for installed capacities of up to 5kWp. Future perspective is that, as in the wind energy sector, most of the equipment will no longer be imported, but increasingly manufactured in Brazil. Therefore, national competition will increase and exposure to the US dollar volatility will decrease. This year the study surveyed separately prices charged by installers and by manufacturers, on the one hand, and, on the other hand, by retailers of modules and / or inverters, who charge an average of R$8.42 / Wp for systems of up to 5kWp.

The brazilian market of distributed solar PV generation

71

Annual Report 2016

“The Brazilian photovoltaic distributed generation market� survey was born in 2013 with the purpose of reporting, monitoring, and strengthening the Brazilian photovoltaic solar energy market by collecting data on the sector.

In this third edition, in 2016, it is already possible to notice the market trend to grow. We believe that the 2017 edition, compared to the 2016, will reflect important changes in this scenario due to the reformulation of ANEEL’s Resolution 482/2012.

This survey helps substantiate policy decision-making and actions. Furthermore, it provides companies with support for making strategic decisions and helps those who are new to this market to understand how it is developing.

The brazilian market of distributed solar PV generation

72

Annual Report 2016

The brazilian market of distributed solar PV generation

73

Annual Report 2016

BIBLIOGRAPHIC REFERENCES ANEEL (AGÊNCIA NACIONAL DE ENERGIA ELÉTRICA). Brasil ultrapassa 5 mil conexões de micro e minigeração. Publicado em 26 set. 2016. Disponível em: <http://www.aneel.gov.br/sala-de-imprensa-exibicao/-/ asset_publisher/XGPXSqdMFHrE/content/brasilultrapassa-5-mil-conexoes-de-micro-e-minigeracao/656 877?inheritRedirect=false&redirect=http%3A%2F%2F www.aneel.gov.br%2Fsala-de-imprensa exibicao%3Fp_p_ id%3D101_INSTANCE_XGPXSqdMFHrE%26p_p_ lifecycle%3D0%26p_p_state%3Dnormal%26p_p_ mode%3Dview%26p_p_col_id%3Dcolumn-2%26p_p_col_ count%3D2>. Acesso em: 27 set. 2016. ______. Cadernos Temáticos ANEEL. Micro e minigeração distribuída: sistema de compensação de energia elétrica.

2. Ed. Brasília: ANEEL, 2016a. ______. Geração distribuída amplia número de conexões em 2015. Publicado em 22 jan. 2016b. Disponível em: <http://www2.aneel.gov.br/aplicacoes/noticias/Output_ Noticias.cfm?Identidade=9044&id_area=90>. Acesso em: 30 ago. 2016. ______. Geração distribuída supera 1000 conexões no Brasil. Publicado em 29 out. 2015. Disponível em: <http://www2.aneel.gov.br/aplicacoes/noticias/Output_ Noticias.cfm?Identidade=8899&id_area=90>. Acesso em: 28 set. 2016.

The brazilian market of distributed solar PV generation

74

Annual Report 2016

______. Resolução Normativa nº 482, de 17 de abril de 2012. Publicado em 17 mar. 2012. Disponível em: < http://www2.aneel.gov.br/cedoc/ren2012482.pdf>.

Acesso em: 08 set. 2016. ______. Resolução Normativa nº 687, de 24 de novembro de 2015. Publicado em 24 nov. 2015a. Disponível em: <http://www2.aneel.gov.br/cedoc/ren2015687.pdf>.

Acesso em: 08 set. 2016.

CASTRO, M. A. L. Diagnóstico e perspectivas para a microgeração no Brasil. RBS Magazine: Revista Brasileira de energia solar fotovoltaica. Ano II, edição n° 6, 2016. Disponível em: <https://issuu.com/ rbsmagazine/docs/revista_rbs_edicao_6_low>. Acesso em: 06 set. 2016.

Empresa de Pesquisa Energética (EPE). Energia Renovável: Hidráulica, Biomassa, Eólica, Solar, Oceânica.

Rio de Janeiro: EPE, 2016.

FOLHA DE SÃO PAULO, 2015. Após alta de 32%, Aneel prevê novo reajuste médio de 10% na energia. Publicado em: 03 mar. 2015. Disponível em: <http://www1.folha. uol.com.br/mercado/2015/03/1597178-apos-alta-de32-aneel-preve-novo-reajuste-medio-de-10-na-energia. shtml>. Acesso em: 09 ago. 2016.

The brazilian market of distributed solar PV generation

75

Annual Report 2016

FRAUNHOFER, 2016. Photovoltaics Report. Freiburg, 6 de junho de 2016. Disponível em: <https://www. ise.fraunhofer.de/de/downloads/pdf-files/aktuelles/ photovoltaics-report-in-englischer-sprache.pdf>.

Acesso em: 06 set. 2016. ______. Aktuelle Fakten zur Photovoltaik in Deutschland.

Publicado em 28 ago. 2016a. Disponível em: <https:// www.ise.fraunhofer.de/de/veroeffentlichungen/ veroeffentlichungen-pdf-dateien/studien-undkonzeptpapiere/aktuelle-fakten-zur-photovoltaik-indeutschland.pdf>. Acesso em: 03 set. 2016.

GREENPEACE. Alvorada: Como o incentivo à energia solar fotovoltaica pode transformar o Brasil. Disponível em: <http://www.greenpeace.org/brasil/Global/brasil/ documentos/2016/Relatorio_Alvorada_Greenpeace_ Brasil.pdf>. Acesso em: 09 set. 2016.

IDEAL, 2016. Rede Solar. Disponível em:< http://app. americadosol.org/redesolar/>. Acesso em 01 set. 2016. ______. O mercado brasileiro de geração distribuída fotovoltaica em 2013. Nov. 2014. Disponível em: <http://www.americadosol.org/wpcontent/ uploads/2014/11/2014_ideal_mercadoGDFV.pdf%20>.

Acesso em: 08 set. 2016.

The brazilian market of distributed solar PV generation

76

Annual Report 2016

______. O mercado brasileiro de geração distribuída fotovoltaica – Edição 2015. Nov. 2015. Disponível em: <https://issuu.com/idealeco_logicas/docs/2015_ideal_ mercadogdfv_150901_final>. Acesso em: 08 set. 2016.

IRENA (The International Renewable Energy Agency).

Renewable Energy and Jobs – Annual Review 2016.

Disponível em: <http://www.irena.org/menu/index.aspx? mnu=Subcat&PriMenuID=36&CatID=141&Subcat ID=2729>. Acesso em 01 de set. de 2016.

Procel Info. Centro brasileiro de informação de eficiência energética. Publicado em 16 set. 2016.

Disponível em: <http://www.procelinfo.com.br/main. asp?ViewID=%7BF5EAADD6-CCB0-4E29-A0C4482D3D66BB65%7D&paams=itemID=%7BC8 6D7-5705-4EC7-976D-54C86552CD58%7D;& UIPartUID=%7BD90F22DB-05D4-4644-A8F2FAD4803C8898%7D>. Acesso em: 19 set. 2016.

The brazilian market of distributed solar PV generation

80

Annual Report 2016

SPONSOR SHI P Gold

Silver

ENGIE logotype_gradient_BLUE_CMYK 14/04/2015

24, rue Salomon de Rothschild - 92288 Suresnes - FRANCE Tél. : +33 (0)1 57 32 87 00 / Fax : +33 (0)1 57 32 87 87 Web : www.carrenoir.com

Bronze

RÉFÉRENCES COULEUR

C100%

Zone de protection 1 Zone de protection 2 Zone de protection 3

energias renováveis