Distributed solar power could be the way forward for achieving Brazil’s climate objectives, but its uptake is determined more by socioeconomic factors than by availability of solar resources, new research shows.

Analysis released this week by environmental thinkthank the Climate Policy Initiative (CPI) found that regional income, population size and electricity tariffs were the most important drivers in Brazil’s uptake of distributed solar PV, with systems largely concentrated in the country’s southeast and southern regions which have minor solar potential compared to the central and northeast regions.

CPI researchers analyzed 5563 municipalities in Brazil, finding that municipalities with lower annual solar radiation had, on average, more distributed solar PV installed than municipalities with higher radiation levels. Municipalities with higher GDP, population and electricity tariffs had greater numbers of installed PV systems.

Centralized solar power represents just 0.1 per cent of Brazil’s energy mix, while thermal and hydropower plants represent almost 90 per cent. However, decentralized solar power makes up 70 per cent of the country’s total decentralized energy capacity and accounts for 99 per cent of installed consumer units. “This level of consumer interest in decentralized solar energy suggests a great potential for the growth of this renewable,” CPI said.

The researchers also found that the higher the electricity tariff in a municipality, the greater the incentive to invest in PV panels, and the larger the population, the larger the number of installed PV units. And the higher the incomes, the larger the number of consumers with resources to invest in installing PV panels.

But CPI cautioned that these findings do not mean that solar radiation levels are irrelevant.  Indeed, the researchers found that higher solar radiation will significantly increase the number of consumer PV units in a municipality.

Overall, CPI concluded that availability of natural resources alone is insufficient to grow the uptake of PV units in Brazil. The thinktank recommended that demand-side factors be considered in the design of climate policy, and that policymakers work harder to incentivize distributed PV uptake in regions with the highest solar energy potential.

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