Brazil's solar power sector faces escalating import tariffs

Brazil is experiencing spiraling import duties on PV solar panels. 

The development, industry, trade and services ministry (MDIC) raised tariffs on photovoltaic modules from 9.6% to 25% on Tuesday. 

The measure was in response to requests from BYD Energy do Brasil and Sengi Solar Importação e Exportação Indústria e Comércio. 

The federal government believes the move will strengthen the domestic industry. 

According to local solar power association Absolar, the import duty on solar modules has been rising gradually since 2023 – first from 0% to 6% and in January this year to 9.6%. 

In a press release, Absolar said the new increase could lead to the cancellation of at least 281 projects totaling more than 25GW and more than 97bn reais (US$17bn) in investments by 2026. 

The association claims that, contrary to what the government wants, the measure does not promote the growth of the local industry since Brazilian companies “are mere assemblers of modules, based on totally imported inputs.” 

“It’s important to note that the domestic industry is unable to supply even 5% of national demand for photovoltaic panels, with production capacity of 1GW per year, while Brazilian imports in 2023 amounted to more than 17GW,” Absolar said.