Brazil Aneel rejects grid access for green H2 projects

Spanish Market: Fertilizers, Hydrogen
30/04/25

Brazil's electricity regulation agency Aneel has rejected requests for electricity grid connections filed by two renewable hydrogen projects in the northeast of the country — but the decision can be reverted, according to one of the companies.

Spanish project developer Solatio, which is planning a renewable ammonia project in the state of Piaui, had its request for a grid connection rejected by Aneel in a resolution published last week.

In March, Solatio received approval from Brazil's industry minister to build a 3GW electrolyser facility at the Parnaiba Export Processing Zone, with operations expected to start in early 2029. The firm had previously said it aims to achieve over 11GW of electrolyser capacity in Piaui in the long run.

Aneel's decision to reject access to the grid was based on recommendations made by Brazil's grid operator ONS, which found the grid connection request to not be feasible as it "could result in overload and risks of voltage collapse".

In the technical note, Aneel said that this decision "does not constitute a sanction or opposition to the investment itself". Instead it is a reflection of the "current technical limitations" of the power system. The regulator expects that "in the near future, structural works capable of safely serving large loads in the northeast will be proposed and granted".

Brazil's energy ministry has already requested energy planning body EPE an expansion of 4GW of capacity in the northeast grid to accommodate demand from renewable hydrogen projects in the coming years.

Solatio has already submitted a "new technical solution" that was designed with support of the Piaui government and state investment promotion agency Invest Piaui and that it could be approved soon, the developer told Argus.

Earlier this month, renewables firm Casa dos Ventos also had a grid connection request rejected for its 900,000 t/yr renewable ammonia project planned at the Pecem port complex, in Brazil's Ceara state.

Output from the Iracema project could supply TotalEnergies, which is a shareholder in Casa dos Ventos.

Casa dos Ventos' request included a grid link to power a data centre project, which was refused by Aneel too. Aneel has asked ONS to provide "the set of technical information" for its recommendation and increase transparency on its assessments.

Casa dos Ventos was not immediately available to comment.

Hydrogen industry participants in Brazil have grown increasingly concerned about power grid bottlenecks. Even though the government has approved plans to expand grid capacity across the country, the sector worries that this could come too late for projects that hope to be early beneficiaries of Brazil's tax credit scheme unless the procedures are sped up.

By Pamela Machado

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