Bolsonaro scraps solar tax planned by Brazilian regulator

Jan 7, 2020 01:26 PM ET
  • The Brazilian president said the potential introduction of a grid fee for net metered solar systems will be eliminated thanks to an urgent ad-hoc decree expected to be approved soon by parliament. The proposed ‘solar tax’ would have affected all new PV installations with a generation capacity of no larger than 5 MW under Brazil’s net metering regime.
Bolsonaro scraps solar tax planned by Brazilian regulator

A brief post on the Facebook account of Brazilian president Jair Bolsonaro announced agreement has been reached with Rodrigo Maia, president of the Chamber of Deputies, and David Alcolumbre, president of the senate, to approve a decree eliminating a ‘solar tax’ proposed by electricity regulator ANEEL.

The regulator had proposed applying a grid fee on small scale, net metered solar systems with a generation capacity of up to 5 MW.

The social media post was followed by a video in which the Brazilian president claimed the fee had been proposed solely by the regulator, without government approval.

“There will be no taxation for solar energy,” said Bolsonaro.

Ministerial backing

The president’s statement, however, came after ANEEL’s proposal was backed by the Ministry of Economy, which claimed the new tax was necessary to reduce the level of subsidies the government will devote to supporting the net metering scheme, which in Brazil encompasses all PV installations no larger than 5 MW.

“The regulator needs to balance the regulation so that consumers who rely solely on the grid are not affected by consumers who generate their own energy,” said ANEEL chief André Pepitone in November. “There must be a fair allocation of costs. This is the role of the regulator.”

Brazilian trade body ABSOLAR said at the time, the proposed fee ignored the benefits distributed generation offers the grid and power consumers. Marcio Takata, CEO of Brazilian consultancy Greener, said the measure would have halved growth in the distributed generation solar segment.

The growth of net-metered solar in Brazil was particularly strong in the first nine months of last year, with new generation capacity in the segment totaling 833 MW, to more than double the country’s cumulative capacity for net-metered solar, to 1.42 GW.

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