Ministry of Mines and Energy Introduces Solar-Focused Ordinance to Boost Distributed Energy Mining Projects in Brazil

The Ministry of Mines and Energy announced the publication of Ordinance No. 78/GM/MME , regulating the granting of incentives for distributed energy mining projects nationwide. This ordinance outlines procedures for obtaining project classification under the Special Incentive Regime for Infrastructure Development (REIDI).

Under Law No. 14,300/2022, distributed minigeneration projects are eligible for exemption from PIS/COFINS for up to five years. These projects, with power capacities ranging from 75 kW to 5 MW, include renewable energy ventures such as hydroelectric, biomass, biogas, solar, and wind plants.

Minister Alexandre Silveira emphasized the significance of this action in fostering Brazil’s development and facilitating the energy transition. He stated, “The PIS/COFINS exemption will attract new investments, generating jobs and income for Brazilians, while these new energy sources contribute to ensuring the country’s energy security.”

For instance, a solar energy project generating 3 MW of energy has the capacity to serve approximately 2,000 households.

The newly introduced ordinance establishes a specific procedure for agents owning distributed minigeneration facilities to submit their processes for inclusion in REIDI. REIDI, a vital mechanism for making infrastructure projects feasible, provides tax relief during the project implementation phase. The inclusion of distributed generation in this regime is seen as a significant advancement in the energy sector, fostering new investments and enhancing the competitiveness of distributed generation projects.

Carlos Evangelista, president of the Brazilian Association of Distributed Generation, expressed satisfaction with this development, highlighting the association’s dedication to creating a favorable regulatory environment for distributed generation in Brazil. He remarked, “The signing of this ordinance by Minister Alexandre Silveira reinforces our commitment to sustainable development and the country’s energy transition.”

This regulatory update marks a pivotal step in promoting renewable energy adoption and supporting Brazil’s transition towards a greener and more sustainable energy future.