The second electricity auction has resulted in a total of 23 companies from 11 countries, including Mexico, investing $4bn over the next three years in 2,871 MW of new installed renewable power. 57 bidders took part in this auction, held on 22 September, with 23 successful companies being awarded a total of 56 contracts for solar PV, wind power and other clean energies.
The average price per MWh and Clean Energy Certificate (CEL) package in this auction was $33.47, in other words, 30% lower than the price obtained in the first auction. Moreover, efficient product purchase objectives have been achieved, by awarding 80.5% of the capacity, 83.82% of the power and 87.26% of the CELs tendered, with savings of 44.2% for clean energy and 64.1% for power, compared to the maximum prices submitted by the Federal Electricity Commission (CFE).
The big winners of this auction were once again wind and PV. Wind power was allocated 128 MW and almost 4,000,000 MWh, representing 11% and 43% respectively of the capacity and energy auctioned. Also worth mention is the allocation of 25 MW of geothermal power as well as the results for PV which are detailed below.
At the presentation of the results, Secretary of Energy, Pedro Joaquín Coldwell highlighted that as a result of the two electricity auctions held to date in Mexico, the country is approaching its target of 35% originating from renewables by 2024. He also indicated that 34 renewable generation companies will as a result establish in Mexico, bringing a combined investment of $600m and adding some 5,000 MW of new renewable capacity.
Solar power consolidates as the main driver for growth in Mexico’s electricity sector
Following this auction, Asolmex, Mexico’s Solar Power Association, has identified the positive outcome for PV, with 16 projects awarded accounting for a capacity of 1,823 MW, 54% of the total energy auctioned. Solar power has consolidated as the most competitive technology, with prices lower than natural gas combined-cycle generation. With an average price of 31.7 $/MWh, the competitiveness of solar power has improved by 42% compared to the average price of the first auction (44.9 $/MWh), confirming it as the cheapest energy in the CFE’s generation portfolio, even lower than conventional energy.
Both auctions together have allocated a total of 28 PV projects with an output of 3,619 MW, equivalent to an estimated investment of $4.5bn. These projects will enter into commercial operation during 2018 and 2019. Some of the project developers are Acciona, Aleph Capital, Alten, Canadian Solar, Enel Green Power, Engie, FRV, Grenergy, Hanwha Q-Cells, IEnova, Jinko Solar, OPDE, Solar Century, Sunpower, Thermion, Tuto Energy, X-Elio and Zuma Energía, all of which are members of Asolmex.