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Wood Mackenzie expects 6.9GW of new wind capacity through 2029 in Mexico, Central America, Caribbean

June 19, 2020

Renewables Now:

Mexico, Central American and the Caribbean collectively installed 1,830 MW of new wind power capacity in 2019, growing additions by 126% year-on-year, according to market researcher Wood Mackenzie.

The region arrived in 2020 with more than 8.4 GW of cumulative operational wind power capacity, close to 6.5 GW of which is in Mexico.

WoodMac forecasts Mexico, Central America and the Caribbean to install 6.9 GW of new wind capacity through 2029. The Mexican market is again projected to dominate with 6.1 GW of new capacity, or almost 90% of the region’s total.

“Capacity additions will be driven primarily by C&I demand in Mexico and projects solicited by central power authorities and state utilities throughout the Caribbean and Central America. Upside for wind power development in the region is tempered by highly competitive PV and a build-out of gas generation support infrastructure”, said Brian Gaylord, principal analyst at Wood Mackenzie.

Despite being the most promising wind power market in the region, Mexico is looking at challenging times at least until President Andres Manuel Lopez Obrador’s term is over in 2024. The Lopez Obrador government is not expected to hold a long-term power auction during its term. Still, power purchase agreements (PPAs) awarded in previous auction rounds will bring new capacity through 2022 and in 2026.

Overall, auctions will result in 2 GW of new wind capacity in Mexico during the forecast period, WoodMac forecasts. By the end of 2029, PPAs with commercial and industrial off-takers are expected to propel new wind power additions in the country and add some 4 GW of capacity, according to WoodMac.

[Sladjana Djunisic]

More: Mexico, Central America, Caribbean add 1.83 GW of wind in 2019 – WoodMac

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