Renewable energy and the cost of lending in Latin America

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Investment in renewable energy (RE) is on a healthy growth trajectory despite the slump in the price of oil, with developing countries taking an every greater share of it. According to the Trends in Private Sector Climate Finance report published at the end of 2015 by the Climate Change Support Team of the United Nations, global investment in RE projects increased by 55% from 2009-2014, and over 70% of it went to non-OECD countries.  Another promising trend identified in the report is the decline in the perception of risk related to RE technologies, which is reducing the cost of financing and creating conditions for long-term and ...

Clean Energy Certificates for sale in Mexico

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The certificates, known by the acronym CEL (Certificado de Energía Limpia), are central to Mexico's strategy to encourage renewable energy generation. Similar instruments have been created in other energy markets to help generators and large consumer meet renewable energy targets in a cost-effective way through third party development of renewable sources. The sale of the first CELs took place with the long-term energy auction that ended on March 30, though the market to commercialize CELs will not begin to operate until 2018 when generators and large users are due to start meeting renewable energy targets. Targets have been set at 5% for 2018 and ...

Mexico: renewables at auction

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On March 30th, Mexico completed its first long-term renewable energy auction. In doing so, Mexico came through with the promise to pursue a cleaner energy matrix and cheaper prices for energy. This round of bidding included only one buyer, the public utility CFE, which continues to dominate Mexico's electricity sector (see previous posts on launching of wholesale market and permits), but regulators are hopeful that future bids will include other large consumers. This post provides information on the outcome of the auction. The next post will explain the use of Clean Energy Certificates in promoting long-term investment in clean energy. The auction At the end of the day, ...

A boost for renewables in Mexico

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The three members of the North American Free Trade Agreement (NAFTA) signed a deal last Friday, February 12, to cooperate on clean energy and address climate change. The goal of the memorandum of understanding is to integrate the energy systems of Canada, U.S., and Mexico and promote a clean energy agenda. Like many environmental agreements among nations, it will only prove effective if it supplements favorable domestic conditions. Here's some information on electricity trade and renewable energy (RE) within NAFTA,  and the prospects for more integration leading to cleaner energy. According to the Energy Information Agency, in the ten years between ...