- Brazil raises import tax on solar modules from 9.6% to 25%, aiming to boost local production and jobs.
- Industry experts warn the tax hike could threaten 281 solar projects, risking over 25 GW of capacity and BRL 97 billion in investment.
- Concerns grow that the decision may slow solar adoption and undermine Brazil’s renewable energy goals.
Brazil’s Ministry of Development, Industry, Trade, and Services (MDIC) raised the import tax on solar modules from 9.6% to 25%. This increase targets photovoltaic (PV) cells assembled in panels or modules. The Executive Management Committee of the Chamber of Foreign Trade (Gecex-Camex) decided to promote local production and create jobs.
Two key players, BYD Energy Brazil and Sengi Solar, requested the tax hike. BYD Energy Brazil, a unit of China’s BYD, and Sengi Solar pushed for the tariff to support local manufacturers. The government wants to reduce the country’s reliance on imports by strengthening its domestic solar industry. Officials argue that the tax hike will boost local production and generate new jobs.
However, the renewable energy sector responded with concern. Isabella Sene, a technical-regulatory specialist at the Brazilian solar power association Absolar, warned about the potential consequences. She highlighted the risks of this decision, stating that it could negatively affect Brazil’s solar energy growth.
Sene cautioned that the tax hike could lead to the cancellation of up to 281 solar projects. These projects, she said, represent over 25 GW of planned solar capacity and more than BRL 97 billion (USD 16.7 billion/EUR 15.8 billion) in investment. She stressed that these cancellations would undermine Brazil’s expanding solar energy market, which has seen strong growth in recent years.
Other industry leaders share Sene’s concerns. Many worry that the higher tariff will raise costs for developers dependent on imported solar panels. They believe the decision could slow solar adoption in Brazil, a country rich in solar potential. With the tariff, local manufacturers might struggle to meet growing demand, and developers could face delays and cost overruns.
Solar energy advocates argue that the new tax will hinder Brazil’s renewable energy goals. The country has actively sought to diversify its energy mix, with solar playing a pivotal role. Many fear the move contradicts Brazil’s clean energy efforts, especially when global investment in renewables is surging.
Government officials, however, stand by their decision. They believe shielding local production will strengthen Brazil’s manufacturers and help them compete globally. The government aims to foster a more resilient domestic industry and support economic growth by reducing Brazil’s dependence on imported solar modules.
Critics, though, worry the plan could backfire. Without sufficient local manufacturing capacity, the tariff may slow the growth of Brazil’s solar market. In the worst case, Brazil risks missing its renewable energy targets and losing investment and carbon reduction opportunities.
The solar industry in Brazil now faces an uncertain path. The new tariff could reshape the sector, affecting local manufacturers and large-scale solar projects. As Brazil moves forward, industry leaders and renewable energy advocates will closely monitor how this decision reshapes the country’s energy future.
(BRL 1.0 = USD 0.172/EUR 0.164)