Oil companies in Brazil cautiously scale up renewable initiatives

Large oil companies are moving forward with renewable energy generation projects in Brazil, although at a slower pace than initially expected.

The slowness reflects geopolitical factors and the domestic context. Globally, the war in Ukraine has reinforced concern over energy security, leading countries to resume investments in fossil fuels and delay the energy transition. In Brazil, the excess of wind and solar projects and the increase in curtailment also affect the pace of expansion.

At the beginning of this month, Petrobras signed a contract for the construction of a solar photovoltaic plant at the RNEST (Abreu e Lima refinery), in Pernambuco. The plant, which will be built by Brafer Solar, will have a capacity of 12MW.

The state-owned company plans to install 55.5MW of solar photovoltaic power in its refineries. In addition to RNEST, the refineries of Paulínia (Replan) and Henrique Lage (Revap), in São Paulo, and Gabriel Passos (Regap), in Minas Gerais, should receive renewable plants. 

According to Petrobras, the integration of photovoltaic systems into the electric power generation structures of the refineries can increase operational reliability and reduce natural gas consumption, in addition to greenhouse gas (GHG) emissions.

The company’s new business plan calls for investments of US$1.8 billion for 1.7GW in wind and solar projects between 2026 and 2030, compared with the US$4.3 billion planned for 2025–29.

“We reduced investment because, today, we have an excess of renewable energy in the market, given the curtailment,” explained the director of energy transition and sustainability at the state-owned company, Angélica Laureano, during a press conference at the end of November.

On Tuesday (December 9), Laureano said that Petrobras is seeking partners to compete in the country's first battery auction, scheduled for next year. 

“We understand that energy storage is highly relevant for stabilizing the Brazilian power grid,” he said during an event by Pré-Sal Petróleo SA (PPSA) in Rio de Janeiro.

On Monday (December 8), Equinor and its subsidiary Rio Energy began commercial operations at the Serra da Babilônia Solar complex in Bahia. The asset, adjacent to the Serra da Babilônia wind complex, is the first hybrid project in the Norwegian company’s portfolio in Brazil, with 140MW of solar capacity and 223MW of wind capacity.

“Hybrid projects that efficiently integrate solar and wind technologies contribute to a stable and reliable energy supply, while at the same time increasing value creation. These projects, as well as the integration of technologies, will be fundamental for the development of a competitive energy business”, said Helge Haugane, executive vice president of Equinor’s Power division, in a statement.

Equinor's renewable portfolio in commercial operation in Brazil totals about 600MW. The company fully owns the onshore wind complex Serra da Babilônia 1 (223MW) and the solar complex Serra da Babilônia (140MW). It is also a partner in the Complexo Solar Apodi (162MW), in Ceará, and in the Complexo Solar Mendubim (531MW), in Rio Grande do Norte, both operated by Scatec, with Equinor's stake of 43.5% and 30%, respectively.

Rio Energy is developing a 1.5GW pipeline in solar and onshore wind opportunities. Danske Commodities, a trading company controlled by Equinor, supports the strategy of building a portfolio focused on generating value in the country. 

“We hope to be able to supply energy from various sources in Brazil for many decades,” said Equinor president in the country, Verônica Coelho, at the PPSA event.

The French company TotalEnergies maintains a portfolio of 10GW in wind, solar and hybrid projects in Brazil – of which 4.6GW are already in operation – through a joint venture with Casa dos Ventos, with plans to reach 12GW. 

“The goal is to combine renewable energy generation with flexible assets, such as hydropower or battery storage, especially as future auctions make this more viable,” the company general director in the country, Olivier Bahabanian, told BNamericas in an interview published in November.

In the opposite direction, Shell decided, in March this year, to discontinue centralized solar power generation projects and onshore wind power generation projects in Brazil due to a “portfolio adjustment” driven by the scenario of excess renewable supply. The decision also reflects the oil company global strategy, which has been reducing operations in offshore wind, solar, and hydrogen. 

“At this moment, our strategy is focused on the exploration and production business [of oil and gas], biofuels, nature-based solutions, and our energy trading company in São Paulo,” said the president of Shell Brasil, Cristino Pinto, also at the PPSA event.

Offshore wind

Petrobras, Equinor, TotalEnergies and Shell have submitted offshore wind power generation projects to Ibama in recent years. However, regulatory advances are necessary for the projects to get off the drawing board, including the definition of rules for the assignment of areas for harnessing sea winds. The expectation is that the topic will be discussed again in 2026.

(The original version of this content was written in Portuguese)