Public policies for smart grids in Brazil

Abstract

The evolution of existing electricity grids to smart grids is aimed at accommodating increasing shares of renewable generation thus contributing for the de-carbonization of economy, offering more diversified services to consumers, enhancing different types of markets (energy, capacity, ancillary services) and improving the system's overall efficiency. As the economic characteristics of the electricity sector tend to discourage investments in smart grids, many countries have adopted incentive policies to foster the deployment of new technologies, which vary according to the particular characteristics of each country. Therefore, the design of specific public policies for Brazil must consider not only the motivations involved, but also the existing challenges for the implementation of smart grids and the socio-economic context. Moreover, the relevance of the proposed policies can be seen from different perspectives. This justifies the need to elicit information from multiple stakeholders for decision support purposes. This paper presents and assesses a set of policies identified by different stakeholders as having a potential to foster the development of smart grids in Brazil. The methodology to shape this set of policies consisted of a thorough literature review of international experiences, combined with meetings with experts in several domains. Then, these policies were assessed by applying a Delphi questionnaire aiming at measuring their effectiveness in fulfilling the objectives associated with investments in smart grids. A first conclusion is that all policies were assessed as having a positive impact taking into account each of the objectives, differing only in the priority to be assigned to each one. The policies that were considered more relevant were: "Incentive Policies for Promoting Demand-Side Management, Distributed Generation and Storage", "Regulatory Changes to Foster Innovation in the Energy Sector" and "Regulation of New Business Models". Among the policies with the worst scores, "Mandatory Rollout of Smart Meters" and "Establishing Quality Standards for the Telecommunications Industry" were ranked as the two lower-ranked policies, i.e., they were assigned lower priority under all objectives.