Brazil’s state energy planner projects 139 GWh for behind-the-meter BESS by 2036

The growth of distributed solar generation in Brazil, expected to reach nearly 92 GW of capacity by 2036, is opening space for behind-the-meter (BTM) storage. Brazil’s state-owned energy research agency, Empresa de Pesquisa Energética (EPE), estimates that the potential battery market tied to local distributed solar could represent investments of up to BRL 417 billion (USD 75.6 billion) by 2036.

The calculation is based on an average projected daily solar generation of 330 GWh in 2036. Of that total, approximately 268 GWh will come from on-site systems, with 139 GWh representing surplus energy injected into the grid. EPE used this exported volume to size the required storage capacity.

The investment estimate evaluates battery adoption rates across local solar consumers alongside unit costs ranging between BRL 500/kWh (USD 90/kWh) and BRL 3,000/kWh (USD 532/kWh). Under full adoption (at BRL 3,000/kWh), cumulative investment would reach BRL 417 billion. EPE stresses that this represents market potential rather than an investment forecast, with deployment dependent on cost declines, regulations, and system economics.

For Brazil, EPE references turnkey equipment costs of BRL 1,500/kWh ($267/kWh) for commercial and industrial (C&I) systems and BRL 2,750/kWh for residential installations, excluding EPC and grid connection costs. Falling battery prices, wider time-of-use tariffs, and changes to grid injection remuneration under Brazil’s distributed generation law (Law 14,300) will drive storage demand, though economic feasibility remains limited to specific applications.

In its 10-year energy plan (PDE 2036), EPE evaluated three BTM use cases: increasing self-consumption in microgeneration, load management for mid-voltage C&I consumers on green tariffs, and time-of-use tariff arbitrage for low-voltage consumers.

For self-consumption, batteries store excess solar for later use, cutting grid injection. However, storage currently lengthens payback periods compared to standalone PV. Phased reductions in export credits under Law 14,300 encourage self-consumption, but falling acquisition costs remain the critical factor to bring payback times into competitive territory.

For mid-voltage C&I consumers, batteries charge off-peak and discharge during expensive peak hours. EPE identified this application as offering the highest economic potential. In the regulated captive market, systems yield positive net present value (NPV) across all evaluated cost bands. In the free market, storage remains viable up to roughly BRL 1,000/kWh with grid tariff discounts, and up to BRL 1,500/kWh without discounts due to wider peak/off-peak spreads.

For low-voltage residential and commercial consumers, tariff arbitrage yields much narrower margins. Positive NPV appears almost exclusively when battery costs fall below BRL 500/kWh, with results turning predominantly negative above BRL 1,000/kWh. Despite these hurdles, EPE expects solar-plus-storage to carve out specific niches over the coming decade, particularly among consumers prioritizing power resilience.