Brazil has abundant clean energy, but transmission infrastructure is the bottleneck for economic development and the energy transition.
The Brazil stands out in the global energy transition landscape, boasting an electricity mix that is largely renewable, with about 90% of its composition. This impressive figure contrasts with the global average, which hovers around 30%. The country holds vast natural resources, from wind and solar power to biomass potential and the promise of green hydrogen, as well as strategic minerals. However, the mere existence of these sources does not automatically translate into economic advantage if the produced energy cannot reach where it is needed.
For decades, the focus has been on generation capacity. Today, the challenge is multifaceted: it is not enough to simply produce clean energy. It is imperative to ensure its efficient transport, secure storage, intelligent management, and delivery with quality and competitive prices to existing consumption centers and those that will emerge in the future. This distribution capability is the key to turning Brazil’s energy potential into sustainable development and industrial competitiveness.
Transmission is the Path to the Transition
The Brazil has developed one of the largest interconnected electric systems on the planet. However, this system must adapt to a new reality for which it was not originally designed. The global economy is entering an era of intense electrification, where traditional industries seek to reduce their carbon emissions by gradually replacing fossil‑fuel‑based processes with low‑carbon electricity.
At the same time, new and massive energy consumers are emerging: data centers, the revolution of artificial intelligence, electric mobility, green hydrogen production, low‑carbon steelmaking, building automation, and new industrial chains that will demand increasing amounts of electricity. All of these activities are seeking exactly what the Brazil already offers in abundance: renewable and plentiful energy. Building the necessary grid infrastructure to connect these elements can trigger a virtuous cycle of growth.
Challenges and Opportunities in the Electrical Grid
The expansion of electrical grids enables the installation of new consumers, which in turn increases demand. This expanded demand makes new investments in generation, transmission, storage, and technology feasible. Ultimately, such investments raise the competitiveness of the country and attract new economic activities. Energy can transcend its role as mere infrastructure to become a central pillar of Brazil’s industrial policy.
However, this window of opportunity will not remain open indefinitely. Industrial projects that targeted Brazil precisely because of its renewable and abundant energy now encounter difficulties in securing the necessary connections and energy volumes. Some projects scale back, others postpone investment decisions, and unfortunately, some are already beginning to consider markets with more robust, smart, and predictable electrical grids.
The Three Essential Fronts for Progress
For Brazil to capitalize on this energy advantage, three fronts of action must advance simultaneously.
The first is the expansion, modernization, and resilience of the grids. It is not just about building more transmission lines, but about transforming the system to accommodate the expansion of renewable sources, the growing decentralization of generation, the need for storage, digitization, and extreme weather events, which are becoming increasingly frequent. The recurring and growing cuts in renewable generation, the insufficiency of transmission and storage, and the lack of adequate economic compensation mechanisms already erode investor and financier confidence.
The second front addresses regulation, investment remuneration, and tariffs. The investments required to modernize and expand Brazil’s electrical system will be colossal. In the current model, the resources that pay for a significant portion of this expansion are reflected in tariffs, directly impacting consumers and the economy. It is crucial to discuss this model to find mechanisms that protect consumers without turning tariff impacts into a barrier to the very investments that will drive competitiveness and economic growth.
The third front focuses on quality and long‑term responsibility. In the legitimate pursuit of shorter lead times and lower capital costs (CAPEX), a critical infrastructure such as the electric grid cannot be judged solely on price and schedule. Equipment and systems installed today will have a useful life of 20 to 30 years. This requires suppliers who can provide ongoing support throughout the entire lifecycle of these assets. Reliability, safety, proven operational history, knowledge of the specific procedures of the Brazilian grid, local support, and long‑term responsiveness are essential. The total cost, reliability, and safety over decades outweigh the importance of initial CAPEX.
Turning Potential into Development
Strengthening Brazil’s electric grid ultimately means expanding the country’s competitiveness, security, and strategic autonomy. The technology needed for this modernization already exists, with solutions for transmitting large blocks of power, digitization, automation, storage, and increased network efficiency and resilience. The main obstacle is not technology, but creating the conditions necessary to implement these solutions at the speed and scale required.
The energy transition should not be seen only as an environmental agenda, but also as a powerful development agenda. Every new transmission line built, every transformer installed, every substation modernized, and every new connection represents an increase in the capacity to attract investment, develop supply chains, create jobs, and incorporate technology.
The great challenge is to turn this energy advantage into tangible development, industrial competitiveness, and value creation for Brazil. To do so, it is essential to ensure that the energy the country can already produce reaches the places where the future will be built. The decisions made now about electric infrastructure will shape Brazil’s competitiveness for the coming decades and may define the country’s positioning for generations. As reality clearly points out: without transmission, there is no energy transition.