• Regulator sets higher ceiling after Brazil currency slumps
  • Plunging real makes imported solar, wind components expensive

Brazil approved higher rates for wind and solar farms that are planning to participate in an energy auction next month as the country’s currency slumps.

The energy regulator Aneel approved a ceiling price of 381 reais ($97.86) a megawatt-hour for solar projects, according to a statement Tuesday. That compares with a maximum price of 349 reais a megawatt-hour in a similar auction in August. It also set a ceiling price of 213 reais a megawatt-hour for wind farms.

The real has declined more than 60 percent since Oct. 31, when more than 1 gigawatt of solar farms won contracts in the country’s first-ever national solar auction. That’s making imported solar panels and wind turbines more expensive.

In Brazil’s energy auctions, regulators set a ceiling price and developers bid down the price at which they are willing to provide electricity from planned projects. The lowest bids win contracts to sell power.

Energy developers in Brazil applied to sell power from 1,379 plants with a total of almost 39 gigawatts of capacity in the Nov. 13 auction, according to Brazil’s energy research agency EPE. That includes 20.9 gigawatts of solar capacity and 17.9 gigawatts of wind power.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE