Grid parity for utility-scale PV plants: a reality in Chile and Morocco

According to the results of the ninth edition of the PV Grid Parity Monitor study, carried out by the consultancy Creara and sponsored by BayWa, Exosun and PVHardware in cooperation with Copper Alliance, PV generation parity in utility-scale installations can be achieved in the wholesale electricity markets without the need for incentives. This is already a reality in Chile and Morocco and is close to being achieved in Honduras. The report defines PV generation parity as the moment in which the profitability requirements of an investor are fully covered by wholesale electricity market prices.

The 2015 edition, the ninth of this report, is the second study to include utility-scale PV plants with the first report dating from July 2014. The study takes into account an installed capacity of 50 MWp using a single-axis tracking system under a project finance scheme (the economic resources generated by the production of the solar field are used to pay for the loan that the developer requests from the bank to commission the PV installation). The ninth edition of the GPM report analyses the regulation and economic competitiveness of PV technology in different countries: Chile, Honduras, Italy, Mexico, Morocco, South Africa, Turkey and the USA (Texas) with Honduras and South Africa being new additions this year.

The fact that generation parity has not been achieved in a specific country does not mean that utility-scale plants are not being developed. Other reasons exist that might create a favourable situation to incentivise investment, such as the existence of an RPS (Renewable Portfolio Standard) system or a FiT programme or a convenient PPA scheme signed by the investor. Given the volatility of many of the wholesale markets and the rapid drop in PV prices, the competitiveness of utility-scale installations should continue to be analysed over time. Read more…

Article published in: FuturENERGY October 2015