The Brazilian states of São Paulo, Goias, Permambuco, and others, have implemented the previously approved (under Convention 16/15) exemption from the ICMS tax for net-metered solar photovoltaic (PV) systems, as of September 1, according to recent reports.
According to many analysts, the ICMS had functioned as something of a development barrier for the distributed solar energy industry (as well as the wider solar industry) in the highly populous emerging market.
For some background here, the tax exemption was approved in the states of Pernambuco, São Paulo, and Goias last April; and in the states of Ceará, Tocantins, and Rio Grande, and the months following that first approval.
As ICMS tax collection/implementation is the job of the individual Brazilian states — with regard to electricity generation projects affected by net-metering rule 482, relating to the National Electrical Energy Agency — it’s the states’ responsibility to provide exemptions where there is reason to, not the federal government.
The new agreements don’t just provide for ICMS tax exemption, it should be noted, but also pave the way towards the introduction of greater governmental support for net-metering programs.
It’s been reported that the National Electrical Energy Agency (ANEEL) is now researching means of potentially reducing the bureaucracy surrounding net-metering projects/programs — this is in addition to efforts to expand the current setup to encompass projects up to 5 megawatts (MW) in capacity.
Previous estimates from ANEEL have put the possible cap for Brazil’s net-metering project capacity by 2024 as 2 gigawatts (GW). This would rely of course on improvements to current programs. As it stands, the country is home to only around 10 MW in net-metered solar PV project capacity.