30 Oktober 2019

Brazil: Industrial Solar Heat Strategy

An Industrial Solar Heat Strategy for Brazil was just launched by the project Solar Payback. In an 8-page flyer an implementation strategy is decribed that adds 7.5 million m2 of collector area in the next five years in the three major industries - pulp and paper, food and beverage and chemicals.

Solar heat can cover 20 to 35 % of the industrial heat demand after using the waste heat recovery potential, this adds up to 7.5 million m2 collector area in the selected industry sectors. The Solar Payback partners identified actions that are needed to implement the Industrial Solar Heat Strategy.

The paper differs between three different levels of profitability:

  • Since LPG is almost twice as expensive as fuel oil or gas, solar industrial heat plants that replace LPG reach high project IRRs above 20 %  even with common loan interest rates (13.9 %).

  • Investors of SHIP systems that replace gas or fuel oil at 50 to 75 °C should profit from concessional credit lines with effective interet rates of around 4 %, to cut down equity payback periods to around 6 years.

  • Substituting SHIP for gas or fuel oil to produce heat at up to 150 °C is far away from being profitable, since all concentrating collectors are being imported (increasing CAPEX considarably). Only a mix of concentional financing and local production could lead to attractive equity IRRs.

Download the flyer here.