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Imagine that you turn on the fan at the peak of the heat and suddenly the distributor sends an electrical signal turning off the device — not because there was a lack of energy, but because there was too much. This is more or less what happens with solar and wind power plants in Brazil every day. The country generated too much clean energy for what the grid can support, and the surplus simply disappears. Now, in a controversial turn, ANEEL is considering applying this same logic of solar curtailment Brazil to photovoltaic panels installed in homes and businesses — those black panels on the roof that your neighbor installed to save on the electricity bill.
On April 22, 2026, the regulatory agency approved the opening of Public Consultation CP009/2026, which proposes improvements in the treatment of energy surpluses and in the supervision of distributed generation. The consultation was open until June 6. The solar sector was on high alert: for the first time, ANEEL is considering the possibility of co-responsibilizing distributed generation — the 2 million solar panel systems installed in Brazil — for the curtailment problem.
What is solar curtailment Brazil and why it happens every day
Curtailment — in Portuguese, “forced generation cut” — occurs when the National Electric System Operator (ONS) orders plants to shut down or reduce production because the transmission lines cannot carry all the generated energy. It’s a physical bottleneck: the Northeast, where most of the country’s solar and wind farms are concentrated, is geographically distant from the major consumer centers in the Southeast.
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Solar and wind energy are being shut down in Brazil due to a lack of grid infrastructure, while companies lose up to 25% of revenue, cut jobs, and suspend investments, exposing a bottleneck that transforms available clean energy into large-scale waste.
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The numbers are significant. In 2024, Brazil wasted 10% of all wind energy and 17% of all solar energy generated in the country — simply because the grid could not handle the transport. As we have already shown here at CPG, the accumulated loss in the sector over the last three years exceeded R$ 5 billion.
The situation worsens as more plants are built without the transmission network keeping pace with the growth. Sector studies project that centralized solar curtailment could reach 23.5% per year on average as early as 2026 and 27.7% in 2030 if nothing changes. It’s clean energy generated, but it doesn’t reach anyone.
The geographical asymmetry is at the heart of the problem. The states with the highest solar irradiation and wind speed — Ceará, Rio Grande do Norte, Piauí, Bahia — are more than 2,000 kilometers away from the major industrial centers of São Paulo and Rio de Janeiro. Building plants without first ensuring that the transmission lines will carry this energy is like filling a reservoir without opening the pipe.
Solar curtailment Brazil has already driven away 141 plants from the Northeast
The impact on investors was devastating. According to a survey released in April 2026, 141 renewable plants returned their concessions in the Northeast, representing R$ 18.9 billion in abandoned projects. Companies in the sector are simply returning licenses to the government because the business doesn’t add up: generating energy that will be cut before reaching the consumer is not financially viable.
The exodus doesn’t stop there. According to a recent survey, renewable energy companies suspended about R$ 38.8 billion in planned investments for the Northeast between 2025 and 2026. Some are considering migrating projects to other regions or even other countries.
- 141 plants returned concessions in the Northeast in 2025
- R$ 18.9 billion in abandoned renewable energy projects
- R$ 38.8 billion in investments suspended or under review
- 17% of solar energy generated wasted due to cuts in 2024
- Curtailment projection: 23.5% per year as early as 2026 (centralized solar)
Law No. 15,269/2025 attempted to alleviate the situation by establishing that cut generators are entitled to financial compensation. But the regulation is still in the consultation phase, and meanwhile, companies continue not to receive — and continue to give up.
What ANEEL proposes in CP009/2026: co-responsibility of solar DG
Here is the most controversial point: ANEEL, by opening CP009/2026, put on the table the possibility of including distributed generation (DG) — the solar panels of residences, businesses, and small companies — in the solar curtailment Brazil mechanism.
Until now, only large centralized plants were subject to cuts determined by the ONS. Microgeneration and mini-generation distributed were left out. But with the explosive growth of residential photovoltaic systems — Brazil now has over 2 million installed units — DG has come to represent a significant portion of the energy injected into distribution networks, especially during the solar noon hours.
ANEEL director, Agnes Costa, publicly indicated the possibility of “co-responsibilizing” solar DG in two distinct ways:
- Physical generation cut: the distributor sends a signal to the residential system inverter and temporarily interrupts generation during excess periods
- Reduction of compensation credits: the panel owner would not suffer a physical cut but would receive fewer credits on the electricity bill in exchange for the energy injected into the grid during curtailment periods
The agency also set a deadline of 60 days for emergency audits by distributors, focusing on cases of irregular power increase in mini-generation systems — a practice that, according to ANEEL, exacerbates the excess energy in local networks.
The scope of the audit is broad: distributors need to map all distributed mini-generation systems that may have increased their installed capacity without prior authorization. ANEEL points out that this informal practice — common in systems up to 75 kW — contributes to overloading low voltage networks during peak solar hours, making the curtailment problem even more difficult to manage remotely by the ONS.
What changes for those with solar panels at home
For now, nothing changes. CP009/2026 is a public consultation — the first step in a long regulatory process. Contributions were accepted until June 6, 2026. After that, ANEEL analyzes the comments and may or may not publish a normative resolution.
But the sector is already mobilized. Distributed generation associations warn that any reduction in credits breaks the business model of residential systems, whose average payback is calculated precisely based on full compensation for the energy injected. If credits fall, the investment return period lengthens — and the incentive to install panels decreases.
ANEEL’s argument, on the other hand, is that the current compensation system does not reflect the real costs of using the electrical infrastructure. Those who generate energy at noon — when the sun is strong and the grid is already overloaded with solar — and inject it into the grid at that moment create a systemic cost that is not being priced in the current tariff.
There is also a sensitive legal point. ANEEL recognized that any measure affecting distributed generation needs legal approval from the agency’s Federal Attorney’s Office before being implemented. The current legal framework — especially Law 14,300/2022, which regulated distributed generation — protects contracts already signed with distributors. Changing the rules for those who have already invested could lead to large-scale legal actions.
The debate is legitimate on both sides. And the final decision will define the future of the residential solar market in Brazil — which currently employs over 700,000 people and moves about R$ 40 billion a year.
The solution: transmission auctions and batteries
Experts are unanimous: solar curtailment Brazil is an infrastructure problem, not a generation problem. The structural solution is to build more transmission lines to carry energy from the Northeast to the Southeast.
ANEEL is working in this direction. The next transmission auction foresees R$ 22 billion in investments in new electrical infrastructure, focusing on 800 kV direct current lines connecting the renewable hubs of the Northeast to the regions of highest consumption. A previous auction enabled R$ 3.3 billion in new transmission projects still in 2026.
But transmission takes time. The process is slow by nature: the environmental licensing of an 800 kV line alone can take 3 to 4 years. Then come the bidding, construction, testing, and energization. High voltage lines take 5 to 8 years to be built, licensed, and operational. Meanwhile, battery storage emerges as a medium-term solution: the first energy contracting auction for battery storage was scheduled for April 2026, which would allow storing the midday solar surplus for use at night when demand is higher.
The good news is that solutions exist — and part of the private sector is already ahead of the government. Companies like Neoenergia and Enel are already testing lithium battery storage systems in Northeast substations, seeking to absorb the solar surplus at lunchtime to redistribute it at dusk. It’s available technology — what is lacking is scale and regulation that makes the investment attractive.
The Brazilian paradox is cruel: the country has some of the best solar and wind resources on the planet, attracts billions in renewable investments — and at the same time wastes clean energy every day because the grid did not keep up with growth. Solving solar curtailment Brazil is a basic condition for the country’s energy transition not to become an unfinished project.
And if the solution comes by sharing the burden with residential solar panel owners, the debate ANEEL opened in April 2026 will define — for better or worse — the future of distributed generation in Brazil.
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