The clean energy plans of Brazil's Eletrobras

Brazilian energy giant Eletrobras is looking to expand into new business areas associated with clean energy. 

As part of this effort, the firm signed an MOU with Ocean Winds, a JV between France's Engie and Portuguese company EDP, to evaluate the development of offshore wind power projects in Brazil.

Along with these wind projects, Eletrobras is also eyeing green hydrogen initiatives and the upcoming battery storage tender, the first of this kind planned by the government, which is expected to take place next year.

Leonardo Walter, business development and M&A director at Eletrobras, talks with BNamericas on the sidelines of the Brazil Wind Power event about these and other matters.

BNamericas: Is Eletrobras' partnership with Ocean Winds to evaluate offshore wind projects an exclusive one?

Walter: This partnership isn't exclusive, but we signed this MOU because we think that at this time, they're our main partners for the development of these projects. But this agreement doesn't guarantee exclusivity.

BNamericas: What other sectors is Eletrobras looking at?

Walter: We're evaluating the green hydrogen sector because it makes perfect sense in our vision to be in this sector given Eletrobras' portfolio, which also includes renewable energy.

Furthermore, we're paying very close attention to business opportunities in the battery area [and] preparing for the battery auction, where we see good opportunities and we're evaluating the auction of hydroelectric capacity, which has everything to do with our assets today.

BNamericas: Is Eletrobras looking for partners for initiatives in the green hydrogen and battery segments?

Walter: Regarding batteries, without a doubt, our initiatives will only be based on our efforts. We have full capacity to develop projects alone.

Regarding green hydrogen, we will always make a case-by-case assessment, but we have some MOUs about this and our idea is to have partners for this technology.

BNamericas: When do you see green hydrogen projects in Brazil reaching viability and moving forward?

Walter: Market agents expected that these projects would take off quickly but, in fact, this is slowing down a bit, although I have no doubt that the projects will move forward, but I can't say when exactly this will happen.

The reality is that Brazil has the elements to be a protagonist in green hydrogen technology. We have renewable energy and accessible base energy, we have connections, we have access to the sea in various parts of the country, domestic consumption. The possibilities for developing projects are diverse, so it's really only a matter of time.

Furthermore, the cost of the technology involved in green hydrogen projects is falling and the interest of offtakers is increasing.

BNamericas: Are there contracts with offtakers signed in relation to green hydrogen projects in Brazil?

Walter: There are offtaker contracts worldwide, but here in Brazil I'm not aware of any offtaker agreements signed.

At the beginning of discussions about these projects in Brazil, there was difficulty in talking about long-term offtakers, but today it's something that shows more viability.

The offtakers, associated with the other green hydrogen elements I have mentioned, must be present to structure the financing of the projects. They're expensive and large projects, so they take a while to be defined. But we've seen more large projects moving toward a final investment decision.

BNamericas: Regarding offshore wind projects, what are the expansion vectors for this segment in Brazil?

Walter: In general, regarding wind farms, there are several vectors of demand growth. One vector is the green hydrogen projects themselves that require renewable energy, another vector is the increase in demand for renewable energy from datacenters and a final vector is the expansion of electrification in industry, more precisely, the electric vehicle segment.

There are several signs that point to an increase in demand, so optimistic expectations with renewable energy, which includes wind energy, are quite realistic.