Publication detail

Impact of Regulatory Changes on Economic Feasibility of Distributed Generation Solar Units

Author(s): prof. Ing. Karel Janda M.A., Dr., Ph.D., Gabriel Nasser Doile de Doyle, Luiz Célio Souza Rocha, Priscila França Gonzaga Carneiro, Rogério Santana Peruchi, Giancarlo Aquila
Paulo Rotella Junior Ph.D., Gabriel Nasser Doile de Doyle, Luiz Célio Souza Rocha, Priscila França Gonzaga Carneiro, Rogério Santana Peruchi, Giancarlo Aquila
Type: IES Working Papers
Year: 2022
Number: 2
ISSN / ISBN:
Published in: IES Working Papers 2/2022
Publishing place: Prague
Keywords: Distributed Generation, Regulation Policy, Cross-subsidies, Micro-Power Plants, Economic Feasibility Analysis, Solar Photovoltaic Energy
JEL codes: Q41, Q48
Suggested Citation: de Doyle G. N. D., Rotella Junior P., Rocha L. C. S., Carneiro P. F. G., Peruchi R. S., Janda K., Aquila G. (2022): "Impact of Regulatory Changes on Economic Feasibility of Distributed Generation Solar Units" IES Working Papers 2/2022. IES FSV. Charles University.
Abstract: The Brazilian National Electrical Agency (ANEEL) proposed in 2019 that the costs for accessing the electricity grid should be shared among all consumers. This would do away with cross-subsidies where normal consumers without installed solar distributed generation (DG) units effectively cover the costs of access to the grid for consumers with DG units. We compared the viability of two scenarios, one before and the other after the proposed changes, to understand how this legislature will affect the viability of DG projects in Brazil. We did this by studying all 5 regions covering the whole Brazilian area by analyzing data on average solar radiation, demand, and energy prices. We conducted stochastic analysis by varying the investment costs, demand, and energy prices, for DG solar plants. Lastly, we conducted scholastic analysis for the national scenario by varying the Discount Rate (DR). We confirmed that there is a statically significant reduction in economic viability for DG solar units in Brazil if the proposed legislation were to be enacted, while the payback period and other financial indicators differ across regions. We confirmed that solar radiation is not the only decisive factor in determination of economic viability of DG solar production.
Downloadable: wp_2022_02_doyle at al

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