Brazil WindPower 2013 - liveblog day 3

The third day of Windpower Monthly's blog from the Brazil WindPower 2013 conference in Rio de Janeiro, covering events as they happen. If you are at the conference, visit Windpower Monthly at stand 197, 2nd floor.

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Above is an interview with Otávio Silveira, board chairman of the Brazilian Wind Association.

1830hrs Brasilia Standard Time

The end of the event. This year's conference was about consolidation. This was the recurring word in presentations, panels, interviews and conversations. It has not come easily, and wind power has suffered setbacks in the past 12 months.

After three years of strong growth, 2012 was marred by uncertainty, economic downturn and regulatory changes that culminated in an auction where only 281MW was contracted, and at really low prices. But 2013 has looked better, seeming to prove the resilience of wind in Brazil. Demand for auctions returned, with prices rebounding, boosting investor's appetite.

The event this year, however, is noticeably smaller than last year. Final figures for 2013 registered 2120 delegates, with 620 attending the conference, and 120 exhibitors, said Rodrigo Ferreira, CEO of conference organiser Canal Energia. But, as one exhibitor put it, people were more focused and more top people were present, making talking business better.

This is a reflection of changes in the wind sector in Brazil. Marcio Severi, commercial director of CPFL Renováveis, a developer who attended but did not exhibit, said things were busier and companies now seemed to have a target in the sector. "People now know what they are good at and what they are looking for. This is true of turbine suppliers, financiers, O&M and developers."

Companies from outside the sector are more and more interested, said Élbia Melo, executive secretary of the Brazilian Windpower Association (Abeeolica). The association gained at least five new members — topping 84 — including Japanese motor manufacturer Honda, who recently contracted 27MW in wind power and is interested in showing off a stamp that proves it uses wind power in its operations.

Volvo and two other motor manufacturers are also aiming for the stamp, said Melo. "We are consolidating, and had very good news before the event," said Melo.

1730hrs Brasilia Standard Time

Solar power has been lurking in the background of most discussions with developers and manufacturers here. On the back of wind power's recent success, it seems the Brazilian government will give solar power a chance, with photovoltaic and concentrated solar projects able to register for this year's upcoming energy tenders.

Today, the government announced that almost 3GW of solar projects are registered for the November auction. This is small compared to the 15GW of wind power registered, but it is a new source of renewable power that is gaining ground in Brazil's diverse energy scenario, adding to biomass and biofuels. Renova Energia, CPFL Energia and Weg all have projects in solar.

Renova has registered 200MW of solar in the auction, half of its solar portfolio. CEO Mathias Becker said investigations began a year ago on the same locations in Bahia where its wind projects are located. "Solar is complementary to windpower," he said. "We knew we had gold, now we have platinum."

1700hrs Brasilia Standard Time

Brazil's federal energy planning company EPE has approved 629 wind power projects with a combined capacity of 15GW to participate in the November 18 energy auction. The bidders are pitching for 20-year power purchase contracts, with energy delivery to start in 2016.
This will be the third power auction this year and the second to include wind power. On 23 August, 1.5GW of wind projects won power purchase contracts to start delivery in September 2015.
Of the 15GW registered, some 4,728MW are located in the state of Bahia, 3,837MW in the state of Rio Grande do Sul and 2,820MW in Rio Grande do Norte. EPE will now study the documents to select the auction winners. The rules require developers to build or guarantee the 'last mile' connection to the grid.

A representative of developer Renova Energia said the company would register 500MW in projects located in the state of Bahia.

1330hrs Brasilia Standard Time

Although all turbine makers agree that the best news in Brazil’s wind power sector this year was the commissioning of 1.5GW at August's auction, there is no consensus over the prices reached at the auction.

They ranged from BRL 106/MWh to BRL 116/MWh with an average of BRL 110 per MWh. Average prices at last December's auction dipped below BRL 100 per MWh .

Some said that stricter rules and guarantees were adding to the costs. Others said the price was at the limit of making projects economically feasible. Still others praised higher prices.

None of which disguises the relief that suppliers feel that 2012’s fiasco was not repeated, and that BNDES continues to support the industry.


1300hrs Brasilia Standard Time

GE has already acquired up to 200MW in preliminary turbine supply agreements for last August's auction, said Jean-Claude Robert, director of renewables for Latin America.

He was the only executive to give a figure of possible contracts. All others I spoke to said they were in talks. GE has 500 wind turbines in operation.

However, Robert emphasised that the deals still need to be formally closed. He also talked about the new nacelle plant announced yesterday. The local content requirements are behind the decision. Brazil's BNDES requires not only that the nacelle be assembled here, but that a minimum number of components also be made locally

To comply, GE is locally doubling its acquisitions staff to 50 and is studying the possibility of convincing two or three international suppliers to set up shop in Brazil.

1000hrs Brasilia Standard Time 

Two recurring themes are appearing from talks and interviews with manufacturers: the delivery of contracts signed in 2009 onwards, and complying with local content rules. The latter involves producing blades and nacelles here in Brazil.

It seems that the BNDES local content requirements level the playing field and force equipment manufacturers to differentiate in the services they offer to developers. Like a chess game, very little was said about numbers in the talks I had yesterday and much was said about how much support the product suppliers will give to wind farm developers.

Brazil's Weg, an important player in other electric, distribution and generation sectors, already has a supply and services network. Its employees will be trained to service the new Northern Power System turbines, says João Paulo Silva, Weg's wind power manager.

Manufacturers and suppliers session, day three at Brazil Windpower 2013

0700hrs Brasilia Standard Time  

Today's sessions kick off at 0900hrs Brasilia time with the big manufactures giving their opinions on opportunities in the region. But the biggest buzz seems to be around the plenary with finance experts from local and international institutions who will discuss opportunities and challenges related to the local market.

Yesterday saw Brazil's federal power company Eletrobras express its desire to bid for more wind power in upcoming auctions after winning contracts in August's auction, and Bahia state government saying that its calculations have shown that the region's wind resources are "much bigger than we thought".

It also emerged that GE will expand its manufacturing facilities in Brazil to produce nacelles for its GE 1.7-100 and GE 1.85-82.5 wind turbines. 

Keep following the blog for today's developments from the conference.

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