Latin America is made up of many geographical regions with differing politics, policies, demographics and languages. In this look at solar in Latin America we are including all Central American, Caribbean and South American countries. These are considered prime markets for solar adoption for several reasons including vast amounts of sunshine, growing economies and extremely high levels of Co2 emissions per capita.
Latin America is has the second largest oil reserve outside of the Middle East, according to the paper, “Latin America’s Energy Future” by Roger Tissot, so it is not surprising that oil has been and continues to be the leading energy source in Latin America. Natural gas and hydroelectricity are also in wide use. According to the International Energy Agency, Latin America’s electricity consumption expected to grow nearly 3% per year through 2035, with the fastest growing markets being Central America and Brazil. According to a World Bank study Latin America will remain highly dependent on hydroelectric power, with an increased use in natural gas. But due to limitations on hydroelectric development, Latin American countries will have to move away from hydro and fossil fuels and increase its use of renewable resources.
Each country has its own approach to the evaluation, diagnosis, and planned development and integration of renewable energy resources in electricity generation matrix, according to Gabriel Monti, who is in charge of Argentinean photovoltaic development. He pointed to the FiT schemes in Ecuador and net metering in Brazil, which are “starting to catalyse the interest of the various stakeholders,” Monti said, noting that such government actions “have begun to shape markets.”
Another example of government support can be seen in Mexico, where the Mexican President Felipe Calderon recently signed into law climate change legislation that calls for cutting greenhouse gas emissions by 30% by 2020 and 50% by 2050. It also calls for 35% of its energy to come from renewable resources by 2024. Furthermore, it requires government agencies to use renewable energy. Mexico is ranked 12th among the world's top carbon-producers (443.61 million metric tons of CO2 every year or less than 1.5% of global carbon emissions), according to data gathered by the US Energy Information Administration, so this new legislation will cut its carbon emissions while also reducing the country’s reliance on fossil fuels.
Focus on the grid
Latin America had been characterised by the "off grid market", and although they have started to implement grid-connected projects and, according to ing. Alejandro Zitzer, Commercial Director, of Aldar SA, a solar company based in Argentina. He said that there are several examples of off-grid installations powering schools, health centres, national parks and private homes. The PERMER: Renewable Energy Project in Rural Markets, is one such off-grid 4MWp installation, bringing electricity to isolated areas.
An example of a grid-connected project is the Ullum photovoltaic park, in the Province of San Juan, with 1.26 MWp. This was set up through the State Provincial Power Company and was the first photovoltaic park in Argentina.
Waiting for the PV future
In an area rich with traditional energy sources such as oil, natural gas, hydroelectric, and coal, solar energy will likely not be fully exploited in Latin America until it “comfortably reaches grid parity,” according to Gabriel Monti. In the meantime, governments will gradually adopt policies and work on infrastructure, regulations and contracts with those in the electricity industry. They will also develop the technological skills with smart grids, net metering and managing intermittency. And they will look to specific markets as examples, such as PV use on national soccer stadiums and in the important copper mining industry. See “Solar Powered Mining Operation in Chile.”
“The growth rate for solar PV will depend to a very large extent on the ability and interest in the detailed analysis and planning of the Ministry of Energy of each country.”
Monti said that “The growth rate for solar PV will depend to a very large extent on the ability and interest in the detailed analysis and planning of the Ministry of Energy of each country.” He added that, “Numerical analysis discovers segment by segment opportunities.”
As with any market, adoption of renewable energy gets a boost from government support and regulations, but it also requires support from the private sector, which will improve (or develop) transmission infrastructure, make financial mechanisms available and make local energy generation an expected practice.
Monti concluded by saying that “In this sense, the analysis of business models employed in USA would be a guide for the Latin American market.”
Growing number of conference and exhibitions
An indication of the importance of the Latin American solar market is the growing number of trade shows and conferences taking place in Brazil, Chile, Argentina and other Latin American cities. In September 2013, Intersolar South America will make its debut, taking place at Expo Centre Norte in So Paulo, Brazil. Other important solar conferences and exhibitions taking place in September in Latin America include PV Insider LATAM 2013 and the Chilean International Renewable Energy Congress both held in Santiago, Chile, and SolarTech Expo Argentina 2013.