Solar power was the big winner in Mexico’s latest energy auctions, winning 1.3 gigawatts or 55 percent of the projects and 58.3 percent of the clean energy certificates awarded in the auction. Solar was the big winner and came in with a new world record average price of $20.57 per megawatt hour (MWh), according to preliminary results published by Mexico’s Department of Energy (Sener) and the National Center for Energy Control (Cenace).
That’s nearly $10 per MWh lower than the price fetched by a 120 megawatt solar farm in Chile last year at a cost of $29.10 per MWh. The lowest price projects were bid by Enel, which bid projects at 0.177 cents per kilowatt hour, $17.7 per MWh, according to Electrek. That’s significantly lower than the costs of energy from sources like coal-fired power plants, which currently starts at about $60 per MWh, according to Lazard’s recent annual Levelized Cost of Energy Analysis.
Enel won both solar and wind farm bids in the latest round of projects. “We are thrilled about yet another great success in Mexico, a core market for us, and we are proud to confirm our leadership in the country’s renewables arena,” said Antonio Cammisecra, head of Enel Green Power. “Through this important win, we will significantly contribute to the country’s demand for electricity from renewable sources. This is just another step of our strategy in the country that we will implement through organic growth as well as through the ‘build, sell and operate’ model that enables us to leverage on our global pipeline, accelerating our growth worldwide,” he said of the new bids and wins.
The company is investing roughly $700 million to build four wind projects totaling 593 megawatts. It’s also building the 754 MW Villanueva solar farm in Coahuila and the 238 MW Don José PV project in Guanajuato.
Another big winner in the in the bids was ENGIE. That company will invest $580 million to build three solar and one wind project totaling 687.8 MWs of renewable energy, 587 MWs of which are solar projects.
"We are very excited about the results obtained in this auction. We are pleased to contribute to develop the participation of clean energies in Mexico,” said Isabelle Kocher, CEO of ENGIE. “By 2020, ENGIE Mexico will have invested close to 800 million dollars in renewable power generation, with approximately 900 MW of capacity. Our ambition is strong, it is in line with the draw of ENGIE to be a leader of energy revolution.”
Electrek published a summary of the winning bids and posited that the cost of solar power could fall as low as 1 cent per kilowatt hour as soon as 2019. Previously the earliest solar was projected to fall those cost lows was 2025.Tweet