Absolar executive reacts to the increase in tax on solar panels by the Federal Government, warning that the measure puts jobs, investments and financing in the sector at risk.
Rodrigo SauaiaCEO of Brazilian Solar Energy Association (Absolar), expressed concern in a recent interview about the impact of the increase in import tax on solar panels, announced by the Federal Government in the last weeks of 2023. According to him, this measure could significantly compromise the sector, threatening the installation of 18 GW in solar plants in the country. This puts more than R$69 billion in investments at risk, in addition to around 540 direct and indirect jobs.
Sauaia states that the Federal Government's measure harms Brazilian consumers
According to the Absola executiver, the decision to increase the tax on solar panels arises from pressure from national manufacturers seeking protectionist measures against the import of photovoltaic equipment into the Brazilian market.
On Monday (01), several determinations enacted by the Federal Government came into force in Brazil, including the Gecex Resolution nº541, increasing the import value of solar panels with a focus on valuing national production.
However, TO Sauaia, the Federal Government's measure will not resolve this issue, quite the contrary, it will harm Brazilian consumers and the vast majority of the solar sector, benefiting only a small group of national manufacturers already installed in the country.
According to the executive, currently, Brazilian manufacturers produce less than 5% of what the solar energy market needs, with prices that can reach 50% more expensive than international products.
Sauaia states that the increase in the tax on solar panels goes against the Federal Government's own effort to accelerate the country's energy transition, as they put current investments in the sector at risk and threaten to destroy thousands of jobs created over the last decade.
Absolar CEO holds meeting with Alckmin
The executive stated in an interview that, last November, Absolar carried out a mapping with the 122 ex-tariffs most used by small, medium and large solar energy entrepreneurs and that the document was delivered to the Ministry of Development, Industry, Commerce and Services (MDIC).
The association recommended that the Federal Government not eliminate exemptions on solar panels. However, according to Sauaia, the department nevertheless decided to cancel 56 of the 122 ex-tariffs listed by the association.
The CEO stated that a meeting was held with Geraldo Alckmin, the minister and vice-president of Brazil, with his secretaries and his team. During the meeting it was explained that for these projects, most of them larger, there is a risk linked to financing.
Rodrigo highlights that financing banks need the ex-tariff to guarantee financing for projects. If the Federal Government overturns the ex-tariff, the centralized generation enterprise will lose financing, the financing guarantee or this financing will be at risk of not happening due to the lack of this ex-tariff.
Strategic programs will also be impacted according to the executive
The CEO also assessed that the Federal Government's increase in the tax on solar panels could hinder the implementation of Lula's strategic programs, such as the inclusion of solar energy in popular homes in the My home, my life, in public buildings, the decarbonization of the Amazon and the diversification of the Brazilian electrical matrix. Sauaia highlights that the way the Federal Government seeks to encourage national industry is far from efficient.
The best way, according to Rodrigo, would be to establish a competitive industrial policy, based on the creation of incentives to attract manufacturers, such as differentiated financing from the National Bank for Economic and Social Development (BNDES) for products made in the country.
In this sense, to reduce possible damage to society, ABSOLAR recommends that the Federal Government establish a deadline, until the second half of this year, to inaugurate new Brazilian factories producing equipment affected by the increase in the tax on solar panels.
