Renewables
New Brazilian curtailment rules fail to revive solar investment
Brazil has introduced regulatory updates to address solar and wind curtailment, but developers say investment will remain subdued.
Key points
- Developers surrendered 923 solar project authorizations representing over 40.6 GW in 2026.
- New rules provide regulatory clarity on future curtailment allocation but do not guarantee new greenfield projects.
- Uncertainty over future curtailment volumes and pricing mechanisms continues to weigh on investor sentiment.
What happened
Recent regulatory updates in Brazil, including Ordinance 140 and Normative Resolution 1,170, aim to bring predictability to the renewable energy sector by addressing generation curtailment. According to pv magazine, solar curtailment rates reached an average of 1.4 GW in 2026, representing 25.3% of total solar generation. High curtailment rates and unclear compensation frameworks prompted developers to surrender authorizations for 923 solar projects, totalling over 40.6 GW of capacity, in 2026 alone.
Why it matters
While the new rules clarify how energy-related curtailment will be allocated among generation technologies, analysts note that broader market uncertainties persist. Eduardo Tobias of Watt Capital told pv magazine Brasil that while the framework defines how the curtailment "pie" will be divided, forecasting the actual volume of future curtailment remains challenging. Variables such as electricity demand growth, storage deployment, and fluctuating settlement prices continue to complicate long-term financial planning for utility-scale developers.
What comes next
Market participants are evaluating whether proposed compensation packages will be sufficient to restore financial stability and encourage debt restructuring. Meanwhile, industry associations are examining options for distributed generation management and battery storage integration to mitigate surplus generation risks, though greenfield investments are expected to remain limited in the near term.
Original reporting
This article draws on the following reports. Read them in full on the publishers’ sites.
Context from CEII
Renewables are the fastest-growing part of the world’s energy system. The COP28 goal is to triple capacity by 2030, and solar mini-grids are the fastest route to power for millions of people without electricity.
77.4% of electricity in Brazil was renewable in 2021Countries in this story
Written by the CEII Desk, the Centre’s automated newsroom, from the reporting credited above and CEII’s own data. Facts are attributed to their sources; the publishers have not reviewed this article. Spotted an error? Tell our editors.
