## Post

# The price of solar energy in São Paulo, Brazil

From time to time I check the price of solar energy to see if it is feasible for my house in São Paulo.

I accessed the solar portal and used the calculator available. To produce 6 thousand kWh per year the investment is of R$ 28 000 (USD 7 500) associated to a 5 kW system.

My financial calculator indicates that for a period of 5 years of amortization and considering 1% of interest per month, it turns out that, the monthly payment of this investment is R $ 623. Equivalent to R$ 1.2/kWh with respect to the 500 kWh/month energy delivered by the system.

ELETROPAULO, which is the concessionaire that connects my house to the public grid, sells energy at R$ 0.6/kWh.

Even if you take into account the tax subsidies that you may get, there is no way to justify the investment. It means that the energy of the public grid, predominantly produced from hydroelectricity, is way more competitive than solar, even considering the entire value chain involved (generation, transmission and distribution).

### Thank Rafael for the Post!

Energy Central contributors share their experience and insights for the benefit of other Members (like you). Please show them your appreciation by leaving a comment, 'liking' this post, or following this Member.

You are not considering the electricity price increase in your equation. How much will you paid in a 20 year period with your current electricity provider ? How much will you pay in the same period, if you go solar? That is the number you need to calculate

Raul thanks for your comment!

Using your line of thought PV would become feasible if the predicted future power prices (regulated rates) climb substantially. In the post's example it would mean basically that PV would start becoming attractive if we project a doubling of the regulated rates - at least.

This then becomes a guessing exercise! Anyway what I see here in São Paulo, not many home owners are going for PV given the poor IRR (negative actually).

These home owners I talk to are not really in the mood to consider a substantial rate increase to justify the PV solution.

It should be mentioned that Brazilian power rates are already among the highest (BRICS for example). So the competitive edge is a point that should be considered as well.

In your home land do people decide based on predicted power increase or will they calculate using existing power prices vis-a-vis the required PV investment?

Wow I am enjoying the discussion. Rafael besides that, there is an inverse relationship between battery capacity (ampere hours) and the size of load connected to solar. If you have loads with heating elements and motors, the investment in solar would be much more in cost and space (square metres) in order to reliably use your appliances.

Further, there is no guarantee that in the next 20 years, that solar installation will not break down or require maintenance. This aspect adds a cost to solar investment and brings us back to a guessing exercise.

In summary, I feel public grid remains reliable and attractive. Solar can only be used as standby source for light loads.