October 26, 2020

EDP Brasil betting on electric mobility

EDP Brasil betting on electric mobility

EDP recently announced its first commercial electric mobility project in Brazil, where it will be providing customized chargers for electric cars rented by Unidas, in addition to PV solar energy to meet its fleet’s energy requirements. 

Meanwhile, EDP is also developing projects to deploy electric vehicle charging stations in São Paulo and Espírito Santo states. 

In an interview with BNamericas, EDP’s vice president of strategy, development & business strategy, Carlos Andrade talked about the company’s strategy to lead the energy transition, as growth in electric mobility continues apace, and discussed EDP’s plans to triple investments in solar power by 2022.  

BNamericas: Why did EDP decide to invest in the project with Unidas now?

Andrade: This is part of our strategy to lead the energy transition, considering the expected growth of electric mobility. Even though electric cars are still expensive for individuals, this market already makes economic sense for companies, the B2B market. 

If you drive 40,000 km a year, you’ll save 80% in fuel and maintenance costs compared with a gasoline-fueled vehicle. So several firms are planning to switch their fleets to electric power. We ourselves aim to change our global fleet of 4,000 vehicles to entirely electric by the end of this decade. 

BNamericas: What are the main challenges to expand the electric car market?

Andrade: The first is creating the infrastructure to recharge the vehicles. Nowadays, an electric car owner doesn’t know exactly where he’ll be able to recharge. And the change will only come with economic incentives. So we believe that, by beginning to work with companies, including urban mobility apps like Uber and 99 Taxis, the infrastructure will start growing and make electric vehicles cheaper.

BNamericas: Do you think local manufacture of electric cars could be feasible?

Andrade: It depends on demand and infrastructure deployment. Both entrepreneurs and government must have a long-term vision that we want to bet on this business and create incentives, remove obstacles and additional logistics costs… ultimately to reduce the “Brazil cost”, by eliminating red tape and simplifying things. 

BNamericas: Which other projects is EDP carrying out in Brazil?

Andrade: We currently have 60MWp of solar power projects contracted, of which 30MWp are operating and 30MWp are under construction. We’re talking about 24 projects in nine states and the Federal District. We’ve entered the B2B market working with clients such as Banco do Brasil, TIM, Claro, Globo, Johnson & Johnson… but we’re seeing even bigger demand from small and medium-sized companies and residential consumers. So this is the market we are attacking, offering services to reduce energy costs, financing solutions via fintechs or banks or long-term leases for the installation of PV solar panels. 

The energy research company [EPE] estimates that the number of micro and mini distributed generation installations will grow to between 16.8GW and 24.5GW by 2030, and we want to have a much bigger larger share of this market than at present. 

BNamericas: What about projects specifically focused on electric mobility?

Andrade: Our first project consisted of the installation of six electric power charging stations on the Via Dutra highway, between Rio de Janeiro and São Paulo, in partnership with BMW. Then we installed another six in Espírito Santo state. Last year, we approved three projects in an Aneel [national electricity regulator] public tender, totalling 50 reais [US$8.87mn], the biggest one calling for the installation of 30 ultra-rapid charging stations for light and heavy electric power vehicles in São Paulo state. The second involves electric buses in Espírito Santo state and the third the construction of e-lounges, mostly for serving electric vehicle rental companies or urban mobility firms. The deadline for concluding these projects is 2022. 

The next step is transforming all of this into businesses. The agreement with Unidas is the first commercially viable model we’ve launched in the market, combining the car rental service with infrastructure. 

We are also investing in a startup that’s developing an app that allows you to locate and book a charging station, as well as paying for the service. We’ll be launching that soon. 

BNamericas: Which other subjects are likely to be included in EDP’s future R&D portfolio?

Andrade: Energy storage is something that will develop greatly throughout this decade and we’re betting on it globally. In Portugal, a tender for contracting solar power plants with energy storage was carried out recently. It’s a trend, as batteries make it possible to control the intermittency of solar and wind power plants. Furthermore, they can help residential units optimize consumption by discharging during peak hours when energy is more expensive, as well as using them as back-up in case of blackouts.

BNamericas: What’s the forecast for investments in Brazil in the coming years?

Andrade: We’ll be announcing EDP’s financial figures this week, so I can’t share specific data. But we currently invest 100mn reais per year in solar power in Brazil and our goal is to triple this amount by 2022 in order to increase our market share. This is a very atomized market and there will be plenty of room to be filled considering the growth forecasts for micro and mini distributed energy generation.

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