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Uruguay Taking Bids on First Big Solar Farms Using Wind Development Strategy

Uruguay Taking Bids on First Big Solar Farms Using Wind Development Strategy

Uruguay is accepting bids for its first two large-scale solar farms as the nation seeks to take advantage of falling panel prices, replicating a strategy it’s using for wind energy.

Companies have until Oct. 3 to bid for rights to sell energy from a 1-megawatt project and a 5-megawatt site and the winners will be chosen by the end of the year, Martin Scarone, an engineer at the Ministry of Industry, Energy and Mining, said today in a telephone interview. The auction documents were made available yesterday.

Uruguay is seeking to roll out solar farms on a large scale as panel prices fall, as it’s doing now with wind turbines, Ramon Mendez, the ministry’s director of energy, said in a telephone interview. The government expects to be able to buy solar power at rates that are competitive with other energy sources in 2017.

“We’re at the same level with photovoltaic energy now as we were with wind energy five years ago,” Mendez said. “We don’t subsidize renewable energy. We use the maturest technologies to decrease costs.”

Administracion Nacional de Usinas y Transmisiones Electricas, the state power company known as UTE, expects to have 300 megawatts of wind turbines installed by 2014, up from 50 megawatts now, he said. It will be purchasing power from at least 900 megawatts of wind farms that will come online through 2016 at rates as low as $62.35 a megawatt hour.

Profitable Power

The government last year offered to accept proposals from companies seeking to sell energy from large solar plants at $91.50 a megawatt hour after developers said they could do so profitably, he said. Companies including local developer Tecnova Renovables proposed 166 megawatts of projects.

“No one in the world believes we can get projects for $92 a megawatt hour. Not even ourselves,” he said. The auction will guarantee “that at least we will have two smaller projects operational if those other projects are aborted.”

More than 60 companies from Europe, China and the Americas have expressed interest in bidding, Mendez said.

The price of solar panels has fallen to 80 cents a watt from about $4 in 2008 and will reach 52 cents by 2020, Jenny Chase, head solar analyst with Bloomberg New Energy Finance, said today in an e-mail.

Copyright 2013 Bloomberg

Lead image: Flag of Uruguay via Shutterstock

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