The Brazil power EPC market is witnessing significant growth with CAGR greater than 7.5%. Factors such as huge investment and government policies are likely to drive the Brazil power EPC market during the forecast period. In the Brazilian Energy Expansion Plan for 2024, published by the Brazilian Ministry of Mines and Energy (MME), the Brazilian energy matrix goal is to maintain a high share of 45 percent from renewable energy by 2024. Furthermore, the Upcoming wind power project, solar project, and nuclear power plant, such as Angra 3 power plant, are expected to drive the Brazil power EPC market during the forecast period. However, geopolitical tensions and the high fiscal deficit with a high inflation rate are expected to negatively impact the Brazil power EPC market in the short term.
- Renewable energy is expected to dominate the Brazil power EPC Market owing to rapid growth in the wind power market in the duration of 2018-2019. The total installed wind capacity in 2019 accounts for 9.04% of the country's 170,071 MW cumulative installed power generating capacity.
- With the Renewable target of 2030, Brazil was aiming to achieve the renewable capacity to exceed 60GW. Various project majorly of solar and wind power plant project are approved by government. This, in turn, is expected to provide ample opportunity to market studied in coming future.
- Brazil has many ambitious renewable projects lined up. Upcoming projects and rising investments are likely to drive the Brazil renewable market during the forecast period.
Key Market Trends
Renewable energy to Dominate the Market
- Brazil ranked third globally, in 2018, in terms of installed capacity from renewable energy sources, after only China and the United States. It is first by installed biomass capacity, second in terms of hydropower capacity, and eighth regarding wind capacity. The country's favorable geographic conditions have also promoted a massive uptake of photovoltaic systems, which led to a remarkable average annual growth.
- In 2018, renewable sources accounted for 82.5% of total installed capacity in Brazil and 85.9% of the power generated during the period. Hydropower remains the most explored energy source, although its share in the domestic electric energy matrix is gradually decreasing as other renewable sources such as wind and solar gain traction.
- The wind power sector is dominated by the onshore segment as the country does not have offshore wind installations. Moreover, the Brazilian government is focusing on attracting investment for the wind power plant to increase its capacity by 2024. The country leads wind generation in Latin America and registered fifth place in the world in 2018 in terms of the number of wind farms, with roughly 15GW of capacity spread across 600 sites.
- Hence, investments and policies for new projects for renewable energy are expected to be the biggest and the most dominating driver for the Brazil power EPC market during the forecast period.
Upcoming Projects Likely to Drive the Market
- In 2018, the country finished 168 GW of projects in operation which are divided in Hydroelectric Plants with 60.6%, Thermoelectric Plants with 25%, Wind Plants with 8.6%, Small Hydroelectric Plants with 3.1%, Thermonuclear Plants with 1.2%, Photovoltaic Plants with 1.1% and Central Hydroelectric Plants with 0.4%, according to the regulator agency ANEEL and Union Official Diary.
- Brazil stands out in the wind generation, with 13.4 GW of installed capacity (2018). In Brazil, there are 534 wind farms in 12 states, with more than 6600 wind turbines.
- Moreover, at the end of 2018, ANEEL had 2,949 projects registered as DRO, DRI, or DRS (first registration of a project), and wind projects were the highest number with 1,270 followed by photovoltaic projects with 948.
- Besides, in 2019, Canada solar wins 393 MW solar project, which is likely to get commissioned in 2021. Also, the Enel group announced that the company is setting up south America's largest photovoltaic power plant of 475 MW in brazil.
- Furthermore, despite the unfavorable economic and political scenario in Brazil during the past few years, the market for renewable energy continues to grow and attract international players. Brazil's government is regulating various policies to attract domestic as well as foreign investment for the renewable project in the country.
- With large scale renewable projects under construction or financially committed and government initiative, the state is likely to witness growth in energy production through renewable. This, in turn, Brazil's power EPC market are expected to drive the market during the forecast period.
The Brazil power EPC market is moderately fragmented due to many companies operating in the industry. The key players in this market include Fluor Daniel Brasil, Ltda., General Electric Company, ENEL S.P.A, Canadian Solar Inc., Siemens Renewable energy S.A, and others.
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