Brazil’s energy ministry has proposed a 9.2-gigawatt expansion of energy storage systems by 2036, a strategy designed to counteract rising curtailment of renewable energy as solar and wind increasingly dominate the national grid. The initiative forms part of the Decennial Energy Expansion Plan (PDE 2036), now open for public consultation.
The plan divides storage development into three key components: 7.2 GW of battery systems, set to begin deployment in 2028; 2 GW of reversible hydroelectric plants, scheduled to enter service starting in 2035; and 4 GW of demand response measures to adjust electricity consumption during peak demand periods. These measures collectively aim to balance supply and demand more effectively.
By 2036, renewables are projected to supply 47% of Brazil’s total installed generation capacity, up from 41% in the previous year’s forecast. This surge in variable energy sources—primarily solar and wind—has intensified grid management challenges, forcing operators to curtail excess production when demand is low. Storage systems, as outlined in the plan, would absorb surplus energy during high-output periods and release it when demand increases, thereby reducing dependence on thermal power plants.
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The ministry acknowledges that storage alone will not resolve these issues. The plan emphasizes the need for transmission infrastructure upgrades, enhanced renewable energy forecasting, and greater operational flexibility in conventional power plants to achieve full system stability. Economic considerations also play a role, as investments in storage and other flexibility measures must be balanced against the financial cost of curtailment to ensure cost-effective solutions.
Regulatory adjustments are already in motion to address the financial implications of renewable curtailment. Last week, Brazil’s National Electric Energy Agency (Aneel) approved new rules to distribute the economic burden of renewable curtailment among wind, solar, and hydroelectric facilities. This measure will undergo a testing phase before hydroelectric plants are gradually included in the system. Separately, the government and industry finalized an agreement in July to compensate R$3.3 billion in mandatory curtailment costs, as mandated by Law 15.269/2025. The first reserve capacity auction for battery storage projects is scheduled for December 2026, a critical milestone for commercializing these initiatives.
The PDE forecasts Brazil’s total installed generation capacity will rise from 272 GW today to 382 GW by 2036, driven primarily by distributed solar generation, wind power, and non-renewable thermal plants. Distributed solar, already a significant contributor, is expected to expand from 50.3 GW in 2026 to 91.7 GW by 2036, supported by R$96 billion in investments and reaching 13.5 million consumer units. The plan highlights improved control of distributed resources as essential to reducing excess energy production, alongside storage deployment, demand response strategies, and expanded transmission capacity. Despite regulatory changes, including revisions under Law 14.300/2022, which updated net metering policies, distributed generation continues to grow due to falling equipment costs, competitive self-generation pricing, and sustained economic incentives.
