On 17 August 2011, Brazil launched a series of auctions for additional generation capacity for delivery in 2014. In contrast to previous auctions where renewable and conventional thermal-fired capacity competed in separate auctions, in this auction, wind competed directly with not only biomass and small hydro, but also gas-fired generation. Wind emerged as the dominant technology, securing nearly 49% of the nearly 4 GW of total capacity contracted in both the A-3 and Reserve auctions. In contrast to the A-3, in which developers sign contracts with distributors for generation, Reserve auction power is contracted by the state and sold into the spot market. Wind capacity was relatively evenly divided between the A-3 and Reserve auctions, with 55% and 45% shares of the 1,929 MW tendered, respectively. Both A-3 and Reserve contracts provide developers with a 20-year power purchase agreement (PPA). Key trends in this On Point include: Brazil wind contracts beat out gas as competition intensifies. OEM investments drive down costs in buyers' market. As industry matures, utilities look to make an impact.
On 17 August 2011, Brazil launched a series of auctions for additional generation capacity for delivery in 2014. In contrast to previous auctions where renewable and conventional thermal-fired capacity competed in separate auctions, in this auction, wind competed directly with not only biomass and small hydro, but also gas-fired generation. Wind emerged as the dominant technology, securing nearly 49% of the nearly 4 GW of total capacity contracted in both the A-3 and Reserve auctions. In contrast to the A-3, in which developers sign contracts with distributors for generation, Reserve auction power is contracted by the state and sold into the spot market. Wind capacity was relatively evenly divided between the A-3 and Reserve auctions, with 55% and 45% shares of the 1,929 MW tendered, respectively. Both A-3 and Reserve contracts provide developers with a 20-year power purchase agreement (PPA). Key trends in this On Point include: