solar market potential in mexico
TRANSCRIPT
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Solar Market Potential in Mexico
Intersolar Europe 2016, Export forum: Energy Solutions Made in Germany Munich, June 23, 2016
c Gauss Energia
Alberto Valdés President
Mexican Solar Association
Joscha Rosenbusch Principal Advisor GIZ
Programa Energia Solar a Gran
Escala en México (DKTI-Solar)
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Program “Energía Solar a Gran Escala en México”
German Climate and Technology Initiative - DKTI
Präsentationstitel hier eintragen 30.06.2016
Objective:
Improve the technological, financial and organisational conditions for
large scale solar energy applications in Mexico
Areas of work:
Market introduction of innovative solar
technologies
Solar financing capacities
Mecanisms for policy coordination between
public and private sector
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Solar Process
Heat
PV
Power Plants
Program “Energía Solar a Gran Escala en México”
German Climate and Technology Initiative - DKTI
Public Private
Academia and Innovation
Financing
On behalf of:
BMZ - Federal Ministry for
Economic Cooperation and
Development
11/2015 - 10/2019
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Power sector clean generation goals
Präsentationstitel hier eintragen 30.06.2016
Clean generation
• Fossil fuel based plant
with CCS
• Hydro
• Nuclear
• Any renewable energy
source (wind, solar,
bioenergy, others).
• Efficient cogeneration
(definition by CRE)
20% 25% 30% 35% 40% 50%
2015 2018 2021 2024 2033 2053
clean conventional
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Fuente: KPMG, Mexico Energy Conference
The new model of the electricity market
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Reform implementation timeline (selection)
Präsentationstitel hier eintragen 30.06.2016
08/14 10/14 03/15 05/15 09/15 12/15 01/16 03/16 07/16 10/16 2018
Electricity
Industry
Law
Creation
of
CENACE
Clean
energy
certificates
(CEL)
guidelines
5% clean
energy
oblication by
2018
1st
PRODESEN
Energy
transition law
& legal
unbundling
CFE
Results 1st
long term
auction
Principles
power
market
framework
Pase 1
day ahead
and real
time market
Medium
Term
Auction
Rules
Real operation
day ahead,
real time an
CEL market General
Provisions
Distributed
Generation
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Incentives & support for Solar
30.06.2016
Accelerated
depreciation
100% of investments in machinery and equipment used for renewable energy
generation. Include fixed assets, expenses and deferred charges. Min 5 years
operation
Clean Energy
Certificates
(CELs)
Mandate to generate 5% of overall consumption by clean energy in 2018. All market
participants that consume electricity in the system must comply with the mandate and
can use CELs to meet obligations. Solar is a sources eligible for CELs.(1CEL=1MWh)
Net Metering Billing credit for excess electricity generated by RE facilities of retail electricity
consumer
Sustainable
Energy Fund
R&D Renewable energy and energy efficiency.
Projects and calls managed by SENER and CONACYT
Source: GIZ, BNEF, Ley del Impuesto sobre la Renta, SENER, Ley Federal de Derechos
Auctions Regulated Austions for Electricity suppliers (eg CFE) for clean energy, capaity and CELs
other Non-discriminatory network access; reation of wholesale markets, Improved
information provision; simplified approval processes
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Avarage end user electricity prices 2006-2015
30.06.2016
• Subventioned prices
for Households and
Agriculture below
Industry, Business
and Service-sector
• Average price higher
than in the USA
Source: CFE
Household
Business
Industry
Services
Agriculture
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Photovoltaic prices drop
1,8
1,5
1,1
0,9
0,7 0,6
0,5
2009 2010 2011 2012 2013 2014 2015
COST PER WATT PV MODULE
US$
/Wp
Año
359
248
157 125
97,5 84 64
47
2009 2010 2011 2012 2013 2014 2015 2016
LEVELIZED COST ELECTRICITY FOR PHOTOVOLTAIC SYSTEMS
US$
/MW
h
Año
Fuente: Bloomberg
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Large Scale Solar Power
Market opportunities
Spot market • Merchant solar projects: selling electricity and clean energy
certificates (CELs) on the spot.
Bilateral contracts • Medium- to long-term PPA contracts with large consumers or
qualified suppliers.
Auctions
• 15-year energy and 20-year CEL PPA contract with CFE.
• Depending on the technology, 15-year capacity contract may be
applicable.
Präsentationstitel hier eintragen 30.06.2016
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Corporate PPA
30.06.2016
34 28 - 9 8 -
27 -
42 25
277
125 172
301 266
801
275
0
100
200
300
400
500
600
700
800
900
1999
2000
2001
2002
2003
2004
2005
2006
2007
20
08
2009
2010
2011
2012
2013
2014
2015
Wind Biomass & Waste Small hydro Geothermal Solar
Source: CRE, Bloomberg New Energy Finance
Total clean energy capacity installed by
technology (MW) and commissioning date
(1999-2015)
• 2.4GW clean energy PPAs with
corporates
• 2009 increase: wind
• Uncertainty by energy reform: 2015
• Almost 1GW projects to be
commissioned until 2018
• Industrials waiting for price development
• Partner shy away from signing long term
PPA
• Consumer to comply with 5% clean
energy by 2018 : significant cost of non
compliance
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Long Term Auction
Präsentationstitel hier eintragen 30.06.2016
• 15-year contracts on offer
• Bids in $/MW
• Firm capacity, able to
generate at the system’s
100 most-critical hours
• Projects sign a contract to
have a given amount of
capacity available at a
determined zone and
dispatch electricity to the
spot market when required
.
Capacity
• 15-year contracts on offer
• Bids in $/MWh
• Only clean energy
technologies to participate
in the auction (both
baseload and intermittent)
• If the source is intermittent,
hourly benchmarks
references (factores de
ajuste horário) will be
applied to determine final
revenue
• Non-intermittent source
pricing is much simpler with
contracts paying at a
straight $/MWh rate.
• 20-year contracts on offer
• Bids in $/CEL
• Clean energy-only
• Projects may be located in
any part of the grid system
Energy Clean energy
certificates
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Solar 85%
Wind 15%
Renewable power on first auction in Mexico
Renewables distribution on 1st Auction
Solar 74%
Wind 26%
Renewable Energy on first Auction in Mexico
Total 5.402 TWh
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30.0
40.0
50.0
60.0
70.0
80.0
0.0
0.5
1.0
1.5
2.0
2.5
Ene
l
Sun
pow
er
Acc
iona E
nerg
y
Jinko
Sola
rIn
vest
me
nt
Ala
rde
Envi
sion &
Viv
e E
nerg
ía
Ald
esa
Recu
rre
nt E
nerg
y
Therm
ion E
nerg
y
Alte
r E
ners
un
Energy (TWh) CEL(m) Price $/MWh
Mexico’s 1st power auction winners by energy (TWh),
CELs (m) and price ($/MWh)
30.06.2016 USD1 = MXN 17.32
Source: CENACE, Bloomberg New Energy Finance
• A total of 5.4TWh of
power and 5.4m CELs
was contracted
• The auction’s average
contract price was
$47.6/MWh
• The lowest bid of
$35.5/MWh came from
a solar project being
developed by Enel
Green Power
30.0
40.0
50.0
60.0
70.0
80.0
0.0
0.5
1.0
1.5
2.0
2.5
Ene
l
Sun
pow
er
Acc
iona E
nerg
y
Jinko
Sola
rIn
vest
me
nt
Ala
rde
Envi
sion &
Viv
e E
nerg
ía
Ald
esa
Recu
rre
nt E
nerg
y
Therm
ion E
nerg
y
Alte
r E
ners
un
Energy (TWh) CEL(m) Price $/MWh
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Potential market for DG
0
500000
1000000
1500000
2000000
2500000
3000000
3500000
Instalaciones potenciales
Market Size for DG
Usuarios DAC Instalaciones Comercios Instalaciones Industriales
With a penetration level of 5% renewable
energies gets installed capacity
of 3 GW
Fuente: CFE
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source: CFE-CRE
2,7 6,7
16,1
31,7
55,7
85,0
0
10
20
30
40
50
60
70
80
90
MW installed per year
PV Distributed Generation - Market Evolution
source: ANES / CFE-CRE
Fuente: Informe sobre la Participación de Energías Renovables en la Generación de Electricidad en México, al 30 de junio del 2015.
2015
Solar
41 MW
2028
Solar
1,2 GW
MW
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Guideline Solar Distributed Generation (02/2016)
DG Products Definition of DG Compensation
model
Tarif regulation Business model CEL obligation
Source: GIZ, PwC
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Page 18 30.06.2016
Source: IRENA Global Atlas
Deutsche Gesellschaft für Internationale
Zusammenarbeit (GIZ) GmbH
DKTI - Programa de Energía Solar a Gran Escala
en México (DKTI Solar)
Joscha Rosenbusch
Asesor Principal / Programmkomponentenleiter
T +52 (55) 5536 0330
M +52 (1) (55) 4354 3898
I www.giz.de/mexiko