The volume of financing for renewable generation projects in Brazil totaled R$ 36,3 billion in 2025, according to a survey released this Friday (12) by CELA (Clean Energy Latin America).
Although the volume represents a growth of 10,6% compared to 2024, the result is 22% below the historical peak of R$ 46,3 billion recorded in 2022.
According to a consulting firm specializing in financial and strategic advisory services for the energy sector, the figures indicate that the market has not yet managed to recover the pace observed before the challenging cycle that began in 2023, marked by a combination of high interest rates, generation modulation, and an increase in curtailment cases.
The study shows, however, that the trajectory is not homogeneous across different technologies. While solar distributed generation (DG) has demonstrated greater resilience, centralized solar generation continues to face significant pressures.
The wind energy segment has shown signs of recovery after reaching one of the lowest financing volumes in its historical series in 2024, while the energy storage market remains in the regulatory structuring and maturation phase.
Solar distributed generation
According to the study, funding for distributed solar generation projects remained relatively stable between 2023 and 2025, ranging from R$ 13 billion to R$ 14,7 billion.
Although below the record of R$ 21,8 billion registered in 2022, the segment continued to move volumes higher than those observed in centralized solar generation in all recent years.
The exceptional performance in 2022 was driven by consumers rushing to secure the acquired right provided for in Law No. 14.300, which established the Legal Framework for the segment in the country.
In practice, projects that submitted connection requests by January 2023 secured the previous energy compensation rules until 2045, leading to a significant anticipation of demand. With the end of this period, the market naturally underwent an adjustment.
Nevertheless, solar distributed generation has demonstrated resilience even after the end of this cycle. According to CELA, one of the reasons is structural: unlike centralized generation, the economic return of local systems is less impacted by regulatory changes, since a large part of the energy generated is consumed simultaneously with its production.
According to the consultancy, this reduces the effects of the decrease in credit compensation and maintains the return on investment period at levels considered attractive. Another factor pointed out by the consultancy is the continuity of financing for remote projects that secured acquired rights before January 2023.
This group includes shared generation plants and remote self-consumption projects that continued to be developed and financed in subsequent years. CELA emphasizes that the solar distributed generation figures may not fully reflect the growth of the energy storage market.
This is because many battery systems are contracted in conjunction with photovoltaic projects and end up being included by banks in the same financing lines intended for solar energy, which makes part of the growth of the storage segment invisible in sector statistics.
Centralized solar power generation
Centralized solar power generation was one of the segments most impacted by the adverse environment of recent years. According to CELA, the volume of financing fell from R$ 15,1 billion in 2022 to R$ 9 billion in 2025, reflecting a combination of financial, operational, and regulatory challenges.
The first of these is the high cost of capital. With the Selic rate fluctuating between 13,75% and 14,25% in recent years — the highest levels since 2016 — financing new projects has become more expensive, reducing the attractiveness of investments and making it more difficult to close financial deals.
Another factor highlighted by the consultancy is the so-called modulation of solar generation. Since the production of solar power plants is concentrated during the day, precisely when there is a greater supply of solar energy in the system, electricity prices tend to be pressured downwards during peak generation hours.
According to CELA, this is a challenge inherent to the expansion of solar energy itself, and it has required greater participation from complementary technologies, such as wind power generation and energy storage systems, capable of helping to balance supply throughout the day.
The situation is aggravated by the predominant contracting profile in the Free Energy Market. Large consumers typically seek contracts with continuous energy delivery throughout the 24 hours of the day.
Since solar power generation is concentrated in certain periods, developers need to resort to market mechanisms to supplement delivery during off-peak hours, reducing margins and increasing project complexity.
Furthermore, curtailment remains one of the main concerns of the sector. According to the consultancy, generation cuts affected, on average, 17,1% of power plants between April 2024 and March 2025.
The absence of a reimbursement mechanism for these operational restrictions increases the perception of risk on the part of banks and investors, making lending more conservative and hindering the expansion of the sector.
wind energy
In contrast to the trajectory observed in centralized solar generation, the wind power sector showed signs of recovery in 2025. According to CELA, financing allocated to this energy source totaled R$ 12,5 billion, a 40% increase compared to the previous year.
The result represents a recovery after the lowest volume in the historical series recorded in 2024, a period in which the segment was also impacted by the high interest rate environment and the effects of curtailment. The consultancy highlights that the growth dynamics of this source have changed significantly in recent years.
While in the past investments were mainly driven by regulated auctions and long-term financing lines from development banks, currently the Free Energy Market and self-generation projects have come to play a central role in enabling new ventures.
According to the study, the growing share of solar energy in the system has opened up space for an ever-greater complementarity between the two sources.
As solar power generation increases the supply of energy during the day and puts pressure on prices during that period, consumers and traders have begun to seek wind power to build portfolios capable of delivering energy more evenly throughout the 24 hours.
With a more distributed generation profile throughout the day and higher production during periods of low solar irradiance, wind power has come to play a strategic role in the composition of contracts in the Free Market.
According to CELA, this structural demand has been supporting the recovery of investments and increasing the attractiveness of wind power projects in the country.
Batteries
Finally, CELA recorded R$ 126 million in financing allocated to building energy storage (BESS) projects in 2025.
Although the volume represents an increase compared to 2024, it remains far from the peak of R$ 280 million observed in 2023, when significant debenture and investment fund issuances boosted fundraising for the segment.
According to the consultancy, this fluctuation reflects less the actual rate of technology adoption and more the characteristics of the financing instruments used by the market.
This is because resources for storage projects can come from different sources, such as commercial banks, capital markets, and multilateral institutions, and are not always captured uniformly by the survey methodology.
Another factor that helps explain this dynamic is the significant reduction in technology costs. According to CELA, storage systems have seen a cumulative cost drop of around 90% since 2010, with some models experiencing reductions of nearly 50% in 2024 alone.
In practice, this means that it is possible to install more capacity using a smaller amount of capital, which reduces the amount financed even in a scenario of physical market expansion.
The consultancy also highlights that a significant portion of the battery systems currently on the market are contracted in conjunction with distributed generation projects.
In these cases, financing is usually categorized by banks within lines of credit intended for photovoltaic solar energy, meaning that a portion of the growth in the energy storage market does not explicitly appear in industry statistics.
CELA expects that the first auctions dedicated exclusively to storage, scheduled for 2026, will mark a new phase of scaling for the segment, with a direct impact on the financing volumes of future studies.
“The Brazilian renewable energy sector is experiencing a complex transition. Financing has not yet returned to 2022 levels, and the challenges are real: high interest rates, curtailment without a reimbursement mechanism, and a market that is still searching for the right instruments to price and contract the complementarity between sources,” explains Camila Ramos, CEO of CELA.
The good news, according to the executive, is that wind power and energy storage are gaining strategic importance precisely because they "offer the solutions that the electrical system needs, and this should be reflected in the financing volumes of the coming years," she emphasizes.
The consulting firm's data considers disbursements made by the main financial institutions involved in financing renewable energy generation in Brazil, including public and private banks, credit unions, fintechs, and operations structured through the capital market.
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