Catching Up with Chile and its Neighbors in Latin
America’s Fast-Paced Solar Landscape
Manan Parikh
Analyst, Solar
[email protected]
Overview: Largest Projects in Latin America
Large Projects of Note Tracked Across Latin America
Country : Honduras (Nacaome)
Project : Nacaome
Developer: Cohessa
Capacity: 70 MW
Stage: Operational
Country : Mexico (Coahuila)
Project : Villanueva 1 & 3
Developer: Enel Green Power
Capacity: 754 MW
Stage: Contracted
Country : Mexico (Durango)
Project : Tai Durango
Developer: Eosol
Capacity: 50 MW
Stage: Under Construction
Country : Guatemala (Santa Rosa)
Project: Horus I, Horus II
Developer: Grupo Ortiz
Capacity: 85.10 MW
Stage: Operational
Country : Peru (Moquegua)
Project : Moquegua
Developer: Solarpack
Capacity: 20 MW
Stage: Operational, Q1 2015
Country : Chile (Antofagasta)
Project : Finis Terrae
Developer: Enel Green Power
Capacity: 180 MW
Stage: Operational
Country : Brazil (Bahia)
Project : Ituverava
Developer: Enel Green Power
Capacity: 210 MW
Stage: Under Construction
Country : Brazil (Minas Gerais)
Project : Pirapora
Developer: Canadian Solar
Capacity: 240 MW
Stage: Under Construction
Country : Uruguay
Project : La Jacinta
Developer: Fotowatio
Capacity: 65 MW
Stage: Operational
Country : Chile (Atacama)
Project : El Romero
Developer: Acciona
Capacity: 255 MW
Stage: Under Construction
Source: GTM Research Latin America PV Project Tracker
1
Overview: Chile leads regional demand but may soon give way to Mexico and Brazil
100%
90%
6%
3%
6%
80%
Share of Regional Demand
70%
40%
2%
4%
4%
4%
4%
9%
1%
39%
1%
4%
6%
4%
2%
4%
8%
34%
33%
1%
1%
47%
29%
7%
4%
2%
7%
30%
30%
18%
12%
49%
37%
23%
10%
0%
8%
7%
16%
20%
4%
28%
60%
50%
4%
5%
5%
3%
9%
28%
25%
2019E
2020E
14%
3%
2015
Brazil
2016E
Chile
Mexico
2017E
Argentina
2018E
Peru
Central America
The Caribbean
The Rest of South America
2
Chile: Market Developments Center Around Interconnection between the two major grids
Sistema Interconectado del Norte Grande (SING) - Sistema Interconectado Central (SIC) Grid PV Highlights
SING Pipeline Dynamics:
• Chile exported the equivalent of
8% yearly generation to Argentina
in Q1 2016 through the recently
reactivated SING-SADI line
• New interest re-kindled between
Peru-Chile interconnection
SIC Interconnection Developments:
• 50% of the 1.3GWdc operational
now in Chile is located in SIC,
mostly in Atacama: Central
region houses 90% of the
country’s population
Source: GTM Research Latin America PV Project Tracker
Passing of Chile Interconnection Law:
• Allows energy to flow from the
northernmost tip of Chile to close to
the Southernmost region of the
country. Increased solar generation
will as a result be able to flow from
the northern deserts to the
population centers
SING-SIC Interconnection Developments:
• Govt.’s estimate for the completion of the SICSING transmission line is mid-2017 but end2018 is more realistic due to likely delays as
construction
• Projects in SING region completing between
now and 2018 face major grid bottlenecks
because of the lack of offtaker demand
Source: GTM Research Latin America PV Project Tracker
3
Chile: PMGD slide
DRAFT IN PROGRESS
4
Chile’s Reliance on the Merchant Market sets up a scenario in Which Spot Prices May be
Zero
Spot prices in Chile in SIC and SING grids1
200
SIC prices skyrocket as hydro
dam reservoirs slowly get lower
over the summer months and
hydro output decreases
180
160
USD/MWH
140
120
100
80
60
40
SIC prices decrease as snowpacks are
replenished and melt in the spring refilling
reservoirs and increasing hydro generation
20
0
Oct-14
Dec-14
Feb-15
SIC
Apr-15
Jun-15
Aug-15
SING
Oct-15
Dec-15
Feb-16
SIC Projected
Apr-16
Jun-16
Aug-16
Oct-16
Dec-16
SING Projected
Source: GTM Research; 1- Systep
5
Brazil: Over 750MWdc projects under construction in Brazil, but others delayed in moving
forward
PV Developments are taking place all around the country
Banco do Nordeste launched a credit
line to fund projects under the net
metering scheme in the northeastern
states of the country including Piaui,
Pernambuco, and Ceara.
Bahia is the site of the sole project from
the first auction in which solar was a part
of (Q4 2014) which is under construction.
Enel Green Power is developing the
210MW Ituverava project
In Brasilia, the country’s first project
was installed under the new ProGD
scheme, a DG Development Program by
ABSOLAR. Just under 100MW have
been installed under this scheme
Paraiba is working in conjunction
with the Northeast bank to provide
USD $14 million to PV systems for
agriculture.
Minas Gerais announced and then
cancelled its state-wide auction which
would have awarded 200MW of solar
citing a lack in transmission
Sao Paulo is the site of Canadian Solar’s
upcoming 350MW/year PV Manufacturing
facility that should open up in 2016
Source: GTM Research
6
Argentina: Primed for Solar Growth, but Development has yet to take off
Insolation Levels in Argentina
Northwest regions of
Argentina see insolation
levels between 2300-2600+
kWh/m2.
Capacity of Generation-type allocated in
next auction (MW)
100
300
Santa Fe is the first state in
Argentina to establish a
clear net metering law at a
rate of $0.38/kWh
600
Solar
Large population centers are
far from areas of highest
insolation
Wind
Other
– Under the clean energy mandates, a sudden demand of 8% renewable
by 2017 will see that wind will win much more of the share of projects
awarded in the first auction
– Solar will continue to have a stronger footing in the long term towards
the 2025 target.
Source: GTM Research
7
What to Watch For: Auctions and Auctions-related Developments
Solar Capacity Expected to be Auctioned (MW)
2000
100
1800
1600
1400
1200
1500
Over 9 TWh
generation
tendered
1800
90
Auction
pushed
back from
Oct to Dec
USD
65
1000
Over 13 TWh
generation
tendered
800
USD
47
600
80
70
60
First time
Argentina is
doing an
energy auction,
no previous
auction price
400
USD
79.7
900
50
40
PPA Price from
Last Auction in
that country
30
20
300
200
10
0
0
Chile - Aug, 2016
Mexico - Sep, 2016
Capacity (MW)
Argentina - Oct 2016
Brazil - Dec 2016*
Last PPA Average
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Thank You!
Manan Parikh is a Solar Analyst for GTM Research covering global downstream markets, with a primary
focus on Latin America. He authors GTM’s quarterly “Latin America PV Playbook” along with contributing
towards several other efforts in GTM’s international solar coverage. Prior to GTM, his work has been
extensively research based, centering upon alternative fuels infrastructure development and Low Carbon
Fuels Standard (LCFS) policy models for the Schatz Energy Research Center and UC Berkeley in
Northern California.
In California, he was also an ambassador to start-up teams within the Clean Tech Open accelerator as
well as a consultant to DOE SunShot Catalyst Award winner, PVComplete. In Washington, DC he
worked on biomass policy at the American Council On Renewable Energy. He is an alumnus of The
University of Texas at Austin, where he graduated with a B.S. in Biochemistry, as well as the DC-based
Clean Energy Leadership Institute in its inaugural class.
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Latin America PV Playbook
With high insolation levels and growing demand, Latin America is positioned to be one of the most attractive regions on the planet for solar development. GTM
Research introduced the Latin America PV Playbook, quarterly updates and project tracking for the industry’s most exciting region.
What’s in the Playbook?
– Quarterly Market Updates - The Playbook is published quarterly, providing insights into the major developments of the previous quarter. With an eye on
the future, it offers an assessment of the trajectory of the market by forecasting demand and analyzing the projects and players that will make it
happen. Recognizing that the market has numerous upside and downside risks, the Playbook also provides a scenario-based assessment of the
market’s future
– Comprehensive Coverage - The Playbook’s analysis spans across market segments – residential, commercial, industrial and utility-scale, and includes a
deep focus on the major markets of Brazil, Chile and Mexico while covering countries in Central America, the Caribbean and the Rest of South America
– In-depth Project Database - Every quarter, the Playbook is accompanied by the Latin America PV Project Tracker which is a spreadsheet-based database
of over 1,100 projects across all the countries in the region with details on project developers, project sizes, locations, off-takers, PPA values and more
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