Brazil is moving forward with its energy storage auctions, having already registered 296.8 GW of capacity and projecting 7.2 GW of BESS capacity by 2036 , according to the new Ten-Year Energy Expansion Plan (PDE 2036). The gap between current business interest and projected long-term needs raises questions about competition and the prices that could result from the auctions.
“We have 6,000 projects under analysis at NPE and we have a good outlook for competition and lower prices,” said Thiago Prado, president of the Energy Research Company (EPE) , in an exclusive interview with Energía Estratégica, within the framework of the XI Energy Week, held in Santo Domingo, Dominican Republic .
According to the agency's official records, 6091 projects, totaling 296807 MW , expressed their interest in participating in the 2026 Capacity Reserve Leilões, corresponding to the national and general storage contracting mechanisms.
The volume represents a record number of entries for tenders in the Brazilian electricity sector. However, the size of the portfolio does not reflect the actual capacity that will be awarded, as the projects must meet technical qualification requirements.
“The 300 GW is much more than what we are going to contract, but it is a good sign for the country that is trying to establish a national battery industry,” he said.
The new PDE 2036, prepared by the Ministry of Mines and Energy (MME) and the EPE, foresees 7.2 GW of battery storage systems by 2036 , along with 4 GW of demand response.
The figures reflect a planned expansion of storage within the Brazilian electricity system, but they do not equal the volume that will be contracted exclusively in the first auctions.
In fact, when asked about the expectations for the award, Prado referred to the estimates available during the interview and noted: “This is an auction, but in our plans we have more than 6 GW for the next 10 years, 1200 MW per year.”
The subsequent update of the PDE raises that reference to 7.2 GW, while the final amount of capacity reserve to be contracted in the tenders will depend on official definitions and studies of the electrical system.
Thus, the number of interested developers anticipates a dispute over the contracts , with the possibility that competition will push prices down, although there is still no official estimate on the magnitude of any potential discounts.
More than 20 manufacturers are looking to Brazil: domestic content comes into play
In addition to addressing the power and flexibility needs of the system, Brazil seeks to turn BESS auctions into an instrument to boost local battery manufacturing .
As reported by Energía Estratégica, more than 20 manufacturers are evaluating producing storage systems in the country , in a context where the start of bidding processes is beginning to generate industrial expectations.
The strategy relies on two distinct mechanisms: the 2026 LRCAP - National Storage , aimed at projects with equipment that meets national content requirements, and the 2026 LRCAP - Storage , intended for the contracting of new capacity under the remaining established conditions.
Both modalities are part of the guidelines set by the Normative Ordinance No. 136 of the Ministry of Mines and Energy, which seeks to contribute to the reliability and security of the National Interconnected System.
“The auction forecast and the national content requirement are perfectly intertwined, because there cannot be a local content policy without a demand forecast,” said Markus Vlasits , president of the Brazilian Association of Energy Storage Solutions (ABSAE) and CEO of New Charge , in an exclusive interview with Energía Estratégica .
One of the central points will be the adaptation of companies to the requirements of local integration, especially to access the incentive mechanisms that will accompany hiring.
When asked about this process, the president of EPE explained: “They are working with our Brazilian development bank to enable the teams to receive a discount in the auction.”
The statement refers to the participation of the National Bank for Economic and Social Development (BNDES) in the accreditation of equipment and the conditions linked to incentives for local production.
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Meanwhile, the Brazilian market is discussing the possibility of establishing annual storage auctions , an alternative that would offer greater predictability to manufacturers interested in developing industrial facilities.
The continuity of contracts is a variable for companies considering entering the Brazilian market, since a single tender does not necessarily guarantee the volume of orders required to sustain productive investments.
In this context, the results of the first rounds will reveal both the level of competition among developers and the market's response to the demands for national content.
Solar energy, new transmission technologies and curtailment reduction
Beyond the incorporation of batteries, Brazil's energy planning envisions a transformation of the electrical infrastructure to support solar and wind power growth .
The new PDE 2036 projects that both sources will represent approximately one third of electricity generation towards the end of the analyzed horizon, compared to the 28.1% estimated for 2026.
The increased share of renewables will require greater operational flexibility, especially in the face of generation variations and restrictions affecting the transport of electricity to consumption centers.
“We expect solar energy to grow over the next 10 years, and it goes hand in hand not only with batteries, but also with more flexible transmission,” he explained.
Among the planned solutions, EPE is considering a bipolar direct current link using voltage source converter (VSC) technology , intended to provide greater flexibility in the operation of the system.
“Also, the use of Dynamic Line Rating (DLR) technology, in which we monitor the temperature on the transmission lines,” Prado noted.
The tool allows taking advantage of environmental factors that influence the thermal behavior of conductors and, under favorable conditions, increasing the capacity to transport electricity without exceeding technical limits.
“We can transmit more energy if the capes have a lower temperature, depending on the wind or the cold,” he added.
These solutions are also linked to one of the main challenges of the Brazilian system: curtailment, which limits the injection of renewable generation due to network restrictions or energy balance conditions .
In that regard, the official acknowledges that regulatory discussions continue regarding financial compensation for affected businesses.
“Today, Brazil’s regulator, the Agência Nacional de Energia Elétrica (ANEEL), is debating how to pay for older projects due to the prejudices of curtailment,” he noted.
Regarding the outlook for the coming years, Prado differentiates between cuts associated with electricity restrictions and those linked to insufficient demand to absorb all available generation.
“The trend is that curtailment, due to electrical issues with the grid, tends to fall a lot in the coming years, but due to energy issues, it has no load,” he warned.
For Brazil, the growth of the BESS market will be conditioned not only by the interest of developers, but also by the definition of contracting volumes, the conditions of competition and the ability to integrate the new installations into the network.
With 296.8 GW registered, a forecast of 7.2 GW by 2036, and companies evaluating the possibility of manufacturing batteries locally, the first auctions will be crucial in measuring the economic competitiveness of the projects and the possibilities of consolidating a national storage industry.
In this context, on November 5, Future Energy Summit (FES) will land in Brazil , bringing together leaders from the energy sector, authorities, investors and developers to discuss investment opportunities, the progress of renewable energies and the challenges of storage, in a market that is preparing for a new stage of expansion.