Brazil battery auction demand could reach 6 GW, says Absae

Brazil may need between 5 GW and 6 GW of battery energy storage capacity in upcoming capacity reserve auctions, according to industry group Absae. The estimate marks a sharp increase from projections published last year, when the association expected around 2 GW of procurement.

In comments to pv magazine Brasil, Absae Technical Director Fábio Lima said the revision reflects both the results of a capacity reserve auction held in March and updated assessments by Brazil’s National System Operator (ONS) of future power adequacy requirements.

Lima said part of the system’s capacity needs remained unmet after the March auction because some awarded projects were not ultimately approved. He also pointed to ONS assessments indicating loss-of-load risks above levels considered acceptable for the electricity system.

Absae is updating its estimate of the project pipeline expected to compete in the auction. In 2025, the association estimated that developers were preparing around 18 GW of projects for a procurement round expected to contract approximately 2 GW.

Although revised pipeline figures have not yet been published, Lima said investor interest has increased since the auction rules were released, providing greater regulatory certainty for market participants.

The association said interest extends beyond battery developers to include utility-scale and distributed renewable energy companies, thermal power operators, transmission companies, and specialist storage developers.

Absae is also seeing growing interest from battery manufacturers seeking to participate directly in projects through consortium structures or special purpose vehicles, reflecting the importance of long-term performance guarantees under multi-year contracts.

The association views this year’s auction as the first step in establishing a broader energy storage market in Brazil. It said growing electricity demand, increasing deployment of variable renewable generation, and the need to maintain system reliability are likely to support additional procurement rounds in coming years.

Lima said Brazil will likely require recurring auctions for energy storage as the market develops. According to Absae, continued procurement will be essential to scale the domestic storage sector and support the gradual development of a local battery supply chain.

From pv magazine Brazil