Long Term Impacts of RES-E Promotion in the Brazilian Power System

Abstract

This paper analyzes the impact on market prices of the policies that have been adopted in Brazil to foster electricity from renewable energy sources (RES-E), namely wind power. In recent years the Brazilian Government implemented a series of policies that enabled a strong growth of RES-E. Recently more than 14 GW of wind and solar power were contracted. However, as most of the assets are concentrated in specific regions, these policies will induce price differences among areas of the country. In this scope, this paper describes a System Dynamics based model of the Brazilian generation system to evaluate the impact on prices from the deployment of these new sources. The paper describes simulations using realistic data for the Brazilian power system and the results suggest that the difference of prices in the country tend to increase since the Northeast region of the country concentrates most of the wind parks.