Small hydroelectric plants (PCH) demand changes in regulation so that they can compete on an equal footing with other sources and become more competitive in the free energy market. Sector entities understand that plants can be remunerated for important attributes for the system.
In the centralized generation, there was an important nod from the government. In December, the Ministry of Mines and Energy published the guidelines for the A-5 auction, which aims to contract new energy.
Plants from 1 MW to 50 MW will be contracted with supply starting in 2030. Contracts with energy distributors can be important to bring viability to projects and, eventually, also bring competitiveness to contracts on the free market.
Auction boosts segment
The president of the Brazilian Association of PCHs, Alessandra Torres, states that the specific auction for small hydroelectric plants is a long-standing demand from the sector.
“The PCH is not viable in the way the free market is. The prices charged, in our view, are neither feasible nor real, because these are enterprises that do not build their own transmission lines, while PCHs do,” he said.
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The entity states that PCHs need a government policy, as they have important characteristics for the electrical system. Reliability and dispatchability [possibilidade de ser acionadas quando necessário] of hydroelectric plants can be important to meet demand at certain times.
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“There is an oversupply of energy at certain times of the day and a need for energy at peak times, at times of greatest demand, which is the end of the afternoon, when solar generation goes to zero. There is a need in the system to resume a very large volume of firm energy to keep the system standing,” said Torres.
System optimization
The president of the Brazilian Association for Clean Energy Generation (Abragel), Charles Lenzi, believes that it is possible to remunerate small hydroelectric plants for the attributes that plants of this type have.
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“These are projects located close to load centers, enabling the optimization of the transmission system and reducing losses. Furthermore, because they are connected to the distributors’ subtransmission networks, they provide energy and power at critical times of demand,” he stated.
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The way to make PCHs viable for the free contracting environment would be through ancillary services. The National Electric Energy Agency (Aneel) provides for the remuneration of generators for characteristics that guarantee the safety of the system.
“Considering projects already in commercial operation, one way to make them more competitive would be through the economic and financial recognition of their environmental and systemic attributes,” he said.
Among the ancillary services provided by Aneel are self-reestablishment, frequency control and maintenance of operating power reserves.
