The state of desalination projects in Brazil

As droughts are threatening to become more common, countries are eyeing desalination as a solution, but the viability of such projects is not assured in Brazil, where freshwater is still abundant.

BNamericas talked to sector players to gauge the business potential.

Pátria Investimentos 

Local asset management firm Pátria Investimentos controls Aguas Pacifico, which is developing the Aconcagua desalinization plant in Chile to address the water shortage in the agricultural region. 

"We see that the [desalination] sector is gradually expanding in Latin America and the explanation for this is simple: We need to have water available for human consumption and for industry. We decided to start our desalination investments in Chile because it faces a severe water shortage and our solution there produces 1,000l/s, in addition to reducing the need that existed before for transporting water by tanker trucks to serving the industry," Marcelo Souza, partner and head of energy infrastructure strategy at Pátria told BNamericas.

"I see strong demand for desalination projects in Chile and it is one of the countries that have the most investments in this sector. In Brazil, there is not as much water scarcity as in Chile, but we will look at the potential despite there being a lot of freshwater available," he added. 

Ceará plant 

Work on Brazil’s largest desalination plant for human consumption is expected to begin in early 2024 and operations in 2026. The plant should benefit 720,000 residents of state capital Fortaleza. Capex is 600mn reais (US$120mn). 

Águas de Fortaleza, a consortium led by infrastructure firm Marquise, is heading the project with the support of state-owned water utility Cagece. 

"With the advance of desalination plants in Brazil, which we view as a path of no return, it will be necessary to discuss specific regulations. We are able to produce water with very high quality and comply with all existing national and international regulations, but it is necessary to advance with the regulation of waste disposal. There are still a lot of issues surrounding brine in Brazil, you need to be familiar with that to avoid fear. The creation of specific national parameters for this disposal is important," Marquise head Renan Carvalho told BNamericas.

However, the plant faces resistance from telecoms operators claiming construction could damage the submarine cables landing at Ceará beach. The state is an internet hub and destination of most cables serving Brazil.

IFC 

Desalination seems viable only in some parts of Brazil.

"The discussion about possible water desalination projects has been gaining momentum in recent years and there are two situations in which these projects could be interesting. The first is in the semi-arid northeast, which is very dependent on groundwater, which often has salinity levels above those suitable for drinking water nd agricultural uses. Also, for several cities in the northeast, the feasibility of desalination is being discussed, especially on the coast, with a focus on seawater," Stela Goldenstein, an IFC water consultant, and Diogo Bardal, associate operations officer at the IFC in Brazil, told BNamericas in a joint email interview.

"There are still no estimates available on the volume of water that would be interesting to enable desalination projects. It is a difficult estimate to formulate, especially because the use that is made today of available freshwater, which would be partially replaced by desalinated water, is often wasteful, either due to water losses in the supply systems or due to the pollution loads released into rivers, whether due to irrational use in productive activities and households," they added. 

BAHIA 

Although desalination costs have been falling, they still represent a barrier to entry for the public sector. 

"It is not so simple to make a PPP for desalination viable because, in fact, these projects are still expensive. So the viability of a PPP, from the government's perspective, needs to be well assessed on a case-by-case basis," Bahia governor Jerônimo Rodrigues told BNamericas.

Bahia is among the states that experience high temperatures and low rainfall every year.