SAO PAULO, June 9 (Reuters) - General Electric Co has started producing solar power inverters at its plant in Betim, Brazil, looking to supply the country’s nascent solar power industry and possibly export the equipment to countries in the region, a GE executive said on Thursday.
Despite the unfavorable business environment in Brazil, which is on track for its worst recession ever, GE’s marketing director for the Latin America Power Conversion unit, Sérgio Zuquim, said the company was positive about prospects for solar power growth.
“That’s inevitable, there is no turning back,” Zuquim said in an interview. “There is political commitment, following international agreements, for investments on renewables,” he said.
Inverters are a key component on solar power systems. They convert power generated by photovoltaic plates to alternating current, or AC, so it can be fed into a commercial power grid.
With the local production, GE consumers would be able to access more favorable credit lines from Brazil’s development bank, BNDES, which gives better financing terms on deals for locally produced equipment.
The director said the company had already closed four contracts with companies awarded operating licenses for new solar parks in Brazil. The government is promoting solar power generation in an effort to diversify its energy mix.
Initial investment to add the production line to the plant in Minas Gerais state was around $20 million, Zuquim said.
The initial steps on solar power development in Brazil have not been smooth.
Many companies that won licenses in the first licensing round in 2014 have yet to start construction. They are seeking to prolong the deadline to complete the projects, saying Brazil’s recent devaluation of the local currency made the projects financially unfeasible, since they still require sizeable imports.
There are no PV plate producers operating in Brazil to date.
Among companies requesting extension of construction periods are Canadian Solar, Grupo Cobra, Fotowatio and Renova Energia SA.
“We will probably have delays on some projects, but others will go ahead and new licensing rounds will happen,” Zuquim said.
Brazil’s government has already granted licenses for 3.2 gigawatts of solar projects estimated to require about 13 billion reais ($3.83 billion) of investment.
There are two additional licensing rounds scheduled for this year, in July and October. (Writing by Marcelo Teixeira; Editing by Peter Cooney)