The curtailment effect

The Brazilian electric matrix has undergone significant transformation in recent decade, yet it persists with an outdated planning structure. The stark reality is that, due to the rapid expansion of solar energy, production capacity has exceeded energy demand, and a portion of the renewable sources are not being dispatched. Who bears the cost? The wind generator itself. This phenomenon is known as Curtailment. We take a deep dive into what caused the curtailment and what to expect moving forward, as well as the impact a long-term curtailment could have on companies.

Energy price volatility

The higher dispatch of thermal power plants has led to volatile energy prices. In turn, these spikes have led consumers to reduce spot price exposure. A combination of higher demand for Power Purchase Agreements and rainfall being lower than expected at reservoirs has led the medium-term energy price to increase (DCIDE: +37% YoY).

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