Market Trends of Chile Solar Photovoltaic (PV) Industry
This section covers the major market trends shaping the Chile Solar Photovoltaics Market according to our research experts:
Rooftop Solar PV to Witness Significant Growth
- Although utility-scale solar PV projects have gained a significant share in the market studied, small-scale rooftop solar PV systems also play an important role in the market. Moreover, rooftop solar offers the benefits of modern electricity services to households that had no access to electricity, reducing electricity costs, in turn driving the market in Chile.
- The country boasts some of the sunniest places on earth, with areas like the Atacama Desert in the north of the country getting almost 356 days of clear skies. Coupled with high solar radiation and low humidity this makes it one of the best areas in the world for solar PV development.
- In 2012, 7% of the country's electricity was generated from renewables. From this point, it has seemingly gone from strength to strength, with the Chilean government then setting a target of 20% renewable energy by 2025 thereby boosting the prospects of rooftop solar installations.
- In September 2019, Mexican multinational bakery product manufacturing company Grupo Bimbo, announced the inauguration of a self-sufficient solar roof built on top of the warehouse of its company IDEAL, S.A. in Chile, which is the largest of its kind in both Chile and South America. The system is expected to generate approximately 3 gigawatt hours per year and it will mitigate 1,310 tons of CO2 in the atmosphere during this period, which is equivalent to planting over 88,870 trees.
- Moreover, rooftop solar systems generate electricity during daylight, coinciding with the peak hours of most factory operations. Hence, while the sun is out, manufacturing facilities have the option to either limit their dependence on the national grid or abandon it completely. Hence, with the increased use of rooftop solar PV modules, the market is expected to the fastest-growing during the forecast period.
Understand The Key Trends Shaping This Market
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Supportive Government Policies and Increasing Investments to Drive the Market
- Chile's first solar plant, a 3MW project was installed in 2012. Currently, there are more than 2,600 MW of PV operating and a further 2,845 MW under construction, according to Asociación Chilena de Energías Renovables y Almacenamiento (ACERA), the country's renewables trade association.
- This growth has been driven by dramatic reductions in price. When the solar industry first started in the country nearly a decade ago, the Levelized cost of electricity (LCOE) stood at USD 100/MWh. This has fallen to almost USD 20/MWh, a fifth of the price.
- The country has now committed to completely phase out coal-powered generation by 2040, further incentivizing the push to support solar generation.
- According to an estimation made by the Chilean Ministry of Energy and Germany's international cooperation corporation, the Gesellschaft für Internationale Zusammenarbeit (GIZ), the country has a solar energy potential of 1,300 GW. This potential, together with the reduction of the investment costs of solar technologies, transformed. PV technology into one of the most competitive energy technologies operating in Chile.
