Brazil Plans Gas Storage for Renewables

The project is a pioneering effort for Brazil, marking the nation's first natural gas storage initiative, a service already common in the US and Europe. Origem Energia is partnering with Transportadora Associada de Gás (TAG), which operates Brazil's largest natural gas pipeline network, to develop the facility in the state of Alagoas. The storage will be located in depleted gas reservoirs in the Pilar field, an asset Origem Energia acquired from Petrobras. The initial investment is projected to be around $200 million, with an initial storage capacity of 106 million cubic meters, potentially expanding to 500 million cubic meters. Operations are expected to commence in 2025. This initiative comes as Brazil's electricity grid becomes increasingly dominated by renewables, which accounted for over 88% of the country's power supply in 2024. While hydropower is the primary source, wind and solar are expanding rapidly, together representing 24% of electricity generation in 2024. This high dependency on intermittent sources creates a need for reliable backup power to ensure grid stability. The push for energy stability is also driven by a massive increase in demand from the data center industry. Energy consumption from data centers in Brazil is projected to more than double by 2029. Hyperscale investments from major tech companies like Microsoft and AWS are transforming Brazil into a major digital hub, with planned projects expected to increase electricity demand nearly 20-fold by 2035.