Energy sector and according to expectations for 2021

Energy sector and expectations for 2021

For this year, the expectation of the energy sector is better with opportunities for auctions, the free market and Distributed Generation.

Without a doubt, 2020 was a difficult year. This was the year in which the pandemic began and this new scenario has caused many areas to be impacted, such as trade, the industrial sector and transport. For this reason, many sectors had a sharp drop in sales / consumption and the energy sector was no different. However, the discovery of the vaccine and the decrease in cases in many countries, brings hope to the Brazilian electricity sector.

The highlight of 2020 was the plants destined to the free market, to distributed generation and to the use of renewable sources. For 2021, the expectation is to intensify these investments and strengthen the economy.

What are the expectations of the energy sector for 2021?

The first expectation for the sector is the return of energy auctions, announced by the government in 2020. For the private market, this is a good investment area in 2021. In addition, the transmission category ended the year with a major auction, registering an average discount of 55.24% and investments of more than R $ 7 billion.

Therefore, the expectation is high for the maintenance of these investments, with more than R $ 3 billion expected for funds from authorized reinforcement works. As many resources were paralyzed due to the pandemic, there are chances of a new allocation, mainly in the area of ​​infrastructure, which concentrates long-term investments.

Transmission contracts are also expected to remain interesting in the eyes of investors, attracting more players to the sector. Another bet is for the growth of renewables. Even with the 2021 losses, the International Energy Agency foresees the growth of these sources worldwide. The trend is that great powers, such as China and the United States, take big projects from paper and Brazil is no different.

Which sources should be highlighted in this period?

For 2021, the market is betting on the solar source, especially for GD and the free market, and there is also emphasis on the wind source and natural gas. The Brazilian Association of Photovoltaic Solar Energy predicts that the Distributed Generation together with the centralized solar should add investments of R $ 22 billion. With the possibility that the GD rules are updated, the sector believes that in only a very bad situation, there will be a setback in this area.

Since 2012, the solar source has received almost R $ 40 billion in investments. Although the exchange rate variation can impact solar investments, increasing equipment costs, this can also make the country a destination for foreign investments. The Federal Government’s Mais Luz para a Amazônia program is also a bet for investments. In the coming years, it should turn over R $ 3 billion.

The free market is also an interesting bet for the centralized generation. This option has enabled plants to produce tens of megawatts. The expectation is that the year will be marked by many negotiations between generators and traders.

Wind energy is currently the fastest growing in Brazil. Although the sector recognizes the need to recalculate the route in terms of expansion, the free market is expected to house most of the source’s investments. Since 2018, the free market has increased its proportion in relation to the regulated market. In 2021, the ACL is expected to take advantage.

Finally, as the new gas law was passed, the market is confident about development of the sector. Therefore, for 2021, the energy sector foresees an increase in the energy transition, an increase in investments in renewable energy and an expansion in infrastructure works.


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