Solar energy for descentralized energy supply: A real option approach

Abstract

Brazil is one of the countries in the world with highest potential for solar energy supply. In the last years, Brazilian electricity regulation has undergone through considerable changes, most of them to stimulate and promote micro and mini decentralized energy supply arrangements, smart grid solutions and other technologies related to it. Despite of it, there is lack of studies addressing problems like market and user's potential and how markets and services should be prepared to absorb decentralize solar energy generation, especially considering medium and low voltage consumers. Therefore, the articles purpose is to study, using a real option approach, the viability of decentralized solar energy generation's investments considering different market designs. As in Brazil, decentralized energy supply is still incipient; a real option approach provides different scenarios and insights for stakeholders to understand possible market designs conceptions.