Brazil’s power demand expected to grow 3.2% annually
Brazil’s electric power demand is projected to grow 3.2% annually between 2024 and 2028, reaching 89,257MWa (average megawatts) by the end of the period.
The forecast is from electricity trading chamber CCEE, alongside federal energy research company EPE and national grid operator ONS.
Local experts told BNamericas said the new projections do not differ much from the ones released at the end of 2023 and that a situation of energy surplus remains in the country.
According to the first four-month review of 2024, the forecast increase in load for this year is 3.8%, reaching 78,814MWa.
The expectation of GDP growth in 2024 was maintained at the previous forecast of 2%.
A scenario of lower inflationary pressure, continued reduction in interest rates and positive contributions from the labor market were considered.
For subsequent years (2025-28), the GDP growth projections were also maintained at 2.2%, 2.3%, 2.5% and 3%, respectively.
Ingrid dos Santos, CEO of energy trader Indra Energia, said the main difference in relation to the previous projections was due to heatwaves such as the one that hit the country in March, raising the average load for 2024, with slight repercussions in the subsequent years.
According to the expert, the less humid summer has weakened the market's future forecasts, which no longer rely on the optimism of past years that kept current and future prices at lower levels.
"The risk of another bad wet period has increased expectations of future prices being more susceptible to abrupt rises," Santos told BNamericas, noting that this should once again heat up the market for new power generation projects.
She said the government should encourage those projects that add the most energy security and power availability to the system, especially after the experiences with intense heatwaves since the end of 2023.
"In addition, new opportunities for greenfield projects should also arise, offering cheaper long-term prices for today's free consumers and future retailers," added Santos.
Henrique Casotti, a partner at energy solutions firm Genco Energia, said a scenario of energy oversupply remains.
“But there are still projects made possible through energy self-production structures,” he told BNamericas.
Fernando Borborema, energy studies manager at the Delta Energia group, agrees that the country is still experiencing a structural energy surplus.
"We believe that the most correct signaling is low prices for the coming years, justified mainly by the high expansion of intermittent sources in the last three years," he told BNamericas.
Via its press office, 2W Ecobank said that it expected an even bigger figure, given that energy consumption in recent months had been growing at higher rates than those projected for the future.
Despite the frustration, the power trader stressed that Brazil shows resilient growth in projected load, the reason why the market for generation projects continues to be active.
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