BMI View : The results of Mexico's first long-term energy auction prompted an upward revision of our growth foreca sts for the country's non-hydro power renewables industry, and illustrated the immense potential of Mexico's solar sector. However, d espite strong fundamentals and bullish growth rates across the industry, we believe that the country will fall short of its ambitious targets for renewable energy over the coming decade.
|e/f = BMI estimate/forecast. Source: EIA, National sources, BMI|
|Generation, Non-Hydropower Renewables, TWh||13.090||16.960||21.310||26.260||30.520||33.180||35.650|
|Generation, Non-Hydropower Renewables, % y-o-y||22.420||29.520||25.680||23.230||16.220||8.700||7.450|
|Capacity, Non-Hydroelectric Renewables, MW||4,546.5||6,036.7||7,900.4||10,089.9||11,261.8||12,383.7||13,494.0|
|Capacity, Non-Hydroelectric Renewables, % y-o-y||20.0||32.8||30.9||27.7||11.6||10.0||9.0|
Latest Updates And Structural Trends
Mexican state-owned utility Comision Federal de Electricidad (CFE) signed 15-year power purchase agreements (PPAs) with companies for 1,100MW of solar and 620MW of wind power projects at the first private auction of power in Mexico (SeeNews). The projects are estimated to cost a total of USD2.12bn over the next three years, according to Deputy Electricity Minister Cesar Hernandez (SeeNews). Enel Green Power emerged as the biggest winner in the auction by securing the right to sign contracts for about 1GW of solar capacity. The 1.7GW of solar and wind facilities will begin power generation in 2018.
Following Mexico's first long-term energy auction, we have upgraded our growth forecast for the country's non-hydro renewables industry. We forecast total industry's capacity to increase from around 4.5GW in 2015 to 18.6GW in 2025, amounting to an average annual growth rate of 15.5% during this period. This will boost non-hydro renewables contribution to the country's power generation mix from 4.2% in 2015 to 10.4% in 2025.
The energy auction has reinforced our positive long-term outlook for solar power in the country and prompted us to upgrade our solar capacity and generation forecasts over the next 10 years. With more than 2,100MW of solar capacity set to come online by 2018, solar sector is expected to account for around 20% of total non-hydro renewables generation in the country.
In early March 2016, the 102MW Central Eolica Sureste I Fase II wind park in Oaxaca, southern Mexico, came online. Enel Green Power built the 34-turbine facility for a total cost of USD160mn. The wind farm will supply its power to Mexican state-owned utility CFE for 20 years.
The Mexico Renewables Report researched at source contains BMI Research's assessment of the current renewables market in Mexico. The report also contains historical data together with forecasts to end-2018 covering electricity generation (TWh) and electricity capacity (MW).
The renewables sectors covered in the report include Wind, Solar, Geothermal, Tidal and Wave, and Biomass (See Table of Contents for exact coverage). The report also features details on government green energy agendas and funding opportunities, as well as presenting a detailed list of key renewables projects currently being planned or undertaken in Mexico, their capacity, the timeframe of construction and their current status.
The report discusses the various energy policies currently in force, including targets, subsidies and the relevant infrastructure developments or limitations which might impact on renewables growth, analysing the potential effects of regulatory changes in conjunction with the background macroeconomic outlook. Finally, there is a general overview of the competitive landscape in Mexico, together with a detailed summary of the main utilities and manufacturers present and their business operations.
BMI's Mexico Renewables Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with unique independent forecasts and competitive intelligence on the Mexico renewables industry.
- Benchmark BMI's independent renewables industry forecasts for Mexico to test other views - a key input for successful budgeting and planning in the renewables market.
- Target business opportunities and risks in the Mexico renewables sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in the country.
BMI Industry View
Summary of BMI's key industry forecasts, views and trend analysis covering the renewables market in Mexico, regulatory changes, major investments and projects and significant multinational and national company developments.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the renewables sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2010-2012) and forecasts to end-2018 for electricity generation (TWh) and electricity generating capacity (MW) for each individual renewables sector present in the country.
These in turn are broken down into:
Electricity Generation: Overall capacity (TWh), growth % change year-on-year, KWh per capita, % of Total Non-Hydropower renewables generation, % of total electricity generation.
Electricity Capacity: Overall capacity (MW), growth % change year-on-year, % of non-hydroelectric renewables capacity and % of total capacity.
These forecasts are in turn supported by explicit assumptions, in conjunction with analysis of the key risks to the main forecast.
Business Environment Rankings
BMI's Renewables Business Environment Rankings provide fully comparable Risk-Reward Rankings aimed at investors in the regional renewables market.
The rankings methodology makes sophisticated use of various industry, economic and demographic data point.