Why Brazil needs to invest even more in smart grids

The growth of distributed generation and intermittent sources in the Brazilian electricity system makes it even more necessary to invest in smart grids. 

That is the view of Cyro Boccuzzi, engineer and CEO of consultancy firm ECO Engenharia e Energia (ECOee). 

In this interview, Boccuzzi mentions a series of measures that can be taken to cope with the transformation of the national grid – far beyond changing consumption meters.

BNamericas: Why does Brazil need to invest even more in smart grids?

Boccuzzi: The expansion of distributed generation and intermittent sources [solar and wind] are the hot topics, as they’re the most competitive. Today, solar and wind plants are built in much shorter timeframes than hydroelectric and gas plants.

However, many forget that the system needs to be requalified to deal with this new reality. It must have automatic mechanisms to take advantage of these sources while maintaining security. 

When there is too much generation, there can be stability problems. If it's the other way around, there could be shutdowns. 

There's also the challenge of making networks more resilient. We’re going through global climate change, with extreme events that demand intelligence and robustness from the grids. And in Brazil, there are several grids that are more than 50 or 60 years old in critical locations. 

We have unpaid bills from before the first blackout in 2001. The power rate is always being pressured by past bills. More recently, there was the [debt resulting from] Covid and the 2021 drought. 

We need to find ways to make new investments in flexibility services, adjusting supply and demand.

BNamericas: Could you give examples of measures to improve the state of the power grid?

Boccuzzi: In terms of upgrading the networks, we need to modernize them, with a more intelligent design. 

The second point is to use high-level automation, with the concept of ADMS, which stands for advanced distribution management systems. But for this to happen, you need automation at the edge. So there's the challenge of changing electromechanical meters for digital ones. 

Another important measure is to create different electricity rate plans, including pre-paid rates, so that people can adjust their usage. Consumers who agree to reduce consumption at a critical time can have a lower tariff, for example. Those who are away from home all day may be able to contribute to the flexibility of the system.

BNamericas: What are the challenges to making energy metering in the country smarter?

Boccuzzi: A public policy is needed to guarantee a return on investments in changing meters, installing automatic equipment and new high-capacity control systems. 

Eventually, we could think about investments made by the distributor itself in distributed generation, building a solar plant with storage capacity to serve a certain area, instead of building a substation on site. Copel [in Paraná state] was authorized to do this, for example. ISA-Cteep installed a battery storage project on the south coast of São Paulo because consumption there varies seasonally. 

These are all intelligent ways of meeting the demands of the system. 

The MME [mines and energy ministry] has launched a public consultation on the renewal of the distributors' concessions. The new concession contract will no longer be monopolistic, as the grid service that will be offered will be different, since low-voltage consumers can install solar panels on their house and trade their surplus. The nature and risks of the business are changing. There is a risk of making large investments in a grid and then no longer needing it.

BNamericas: Do you have a projection of the investments needed to modernize the national grid? 

Boccuzzi: We estimate around 250bn reais [US$50bn] to modernize the distribution and transmission networks over the next 15 years. 

The challenge is not just to change the meters, but to connect them to the cloud, installing control equipment. If these investments are not made, the grids will operate in a non-optimized way, given the expansion of intermittent sources in the system. 

Investments are needed in systems to manage decentralized plants automatically and in real time, including remotely controlled switches, controls, capacitor banks and voltage regulators and in infrastructure for new loads such as those associated with electric vehicles, for instance.