Market Trends of Mexico Solar Energy Industry
This section covers the major market trends shaping the Mexico Solar Energy Market according to our research experts:
Utility-scale Solar Energy Projects Driving the Renewable Market
- Mexico is currently one of the global hotspots for renewable energy markets. The country lies within the most favorable sunbelt on the planet and enjoys around 2,190 hours of sunshine per year. The major hotspots for the solar energy market in the country include the state of Baja California, Coahuila, Chihuahua, and Sonora.
- In recent years, solar energy has marked itself as the renewable energy with the largest presence in the country. The solar PV market reached the GW scale mark in 2018 for the first time, with 2.7 GW newly installed capacity. In June 2019, the cumulative installed PV capacity increased by 32% and reached 4.057 GW. Also, from December 2018 to May 2019, the number of large-scale solar parks reached 44 operating in 14 states, with an installed capacity of 3.36 GW.
- Moreover, in 2018, the government passed three auctions allocated around 4.8 GW of solar generation capacity, with a cumulative investment of around USD 5 billion for about 40 solar power plants.
- Hence, with several projects under operation and others in the planning and construction phase, Mexico is moving toward becoming a primary solar energy market.
Understand The Key Trends Shaping This Market
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Increasing Demand for Decentralized Solar Energy Systems is Expected to Drive the Market
- Decentralized solar systems, also called as distributed solar energy systems, are small-scale, self-supply solar energy systems that are less than 0.5 MW in capacity and connected to a distribution circuit with a high concentration of load centers. These solar generators do not need a CRE permit for installation.
- Initially, these small-scale solar systems were established in rural areas that are not connected to the national grid. However, gradually, residential and commercial buildings in the urban areas also began installing solar PV panels.
- Though distributed solar generation is still in a nascent stage in Mexico, it witnessed a rapid growth in the last few years. One of the major factors driving the growth of the distributed solar generation is the reduction in the cost of solar PV systems. As of August 2019, average solar energy systems in Mexico cost USD 3.02 per watt, which is less than the average price of solar systems in the United States, which is around USD 3.34 per watt.
- As of 2018, more than 100,000 roofs on commercial buildings, industrial buildings, and homes have distributed solar PV installations. This number is projected to increase to around 650,000, by 2023.
- Hence, owing to the aforementioned factors, the decentralized solar energy systems in the country are likely to grow, which, in turn, is likely to act as a key driver to the market studied, during the forecast period.
