La Oferta

December 2, 2023

Mexico set to become powerhouse of solar energy

Mexico City, Mar 23 (EFE).- With 37 solar power plants under construction and an estimated investment of $5 billion, Mexico is set to become a powerhouse in the solar energy market thanks to regulatory support and enviable geographic advantages.

“By 2019 or 2020 when construction will be finished on almost 40 plants, we’ll be generating some 5,000 megawatts with an investment of some $5 billion,” Executive Secretary Israel Hurtado of the Mexican Solar Energy Association (Asolmex) told EFE.

This surge in the sector is due to the new Energy Transition Law, which opened the sector to private enterprise, and to the three auctions of electricity projects held up to now.

Fotografía cedida hoy, viernes 23 de marzo de 2018, por la agencia Bindivia que muestra a dos expertos mientras instalan un complejo de energía solar (México). EFE

Thanks to the bidding, Hurtado said, Mexico has left behind its status as an emerging market to become one of enormous potential, going from the 150 MW generated just two years ago to the upcoming 5,000 MW.

Meanwhile the price of energy is plummeting.

“It (solar energy) is even cheaper than natural gas or a combined-cycle power plant,” Hurtado said, adding that in recent years solar panel technology has reduced production costs and made the panels last much longer, cutting costs by some 80 percent.

Asolmex expects investment for developing the projects resulting from the three auctions will mean an increase in gross domestic product (GDP) of over 19 billion pesos (more than $1 billion) and will create some 13,000 jobs.

The sector currently has a large presence of foreign companies, which won approximately 90 percent of the projects put out to tender, Hurtado said.

These are large corporations like Italy’s Enel, which this Thursday inaugurated Latin America’s largest solar plant with an investment of $650 million in the northern state of Coahuila.

Then there’s Spain’s Iberdrola, which is currently building the Santiago photovoltaic plant in the central Mexican state of San Luis Potosi, scheduled to enter into service by the end of the year with 672,000 solar panels capable of supplying 138,000 homes with electricity.

There are also local suppliers and manufacturers of the panels, though most come from China, the world’s largest producer.

In Mexico, individuals can have their own solar panels, which reduces the cost by around 95 percent, and in case they have electricity left over, they can inject it back into the system and obtain benefits from the Federal Electricity Commission (CFE).