Abdul Latif Jameel Co, a Saudi Arabian industrial company engaged in everything from auto imports to real estate, is moving its attention to Latin America’s clean-energy market.
The company is aiming on government-organized auctions, where developers vie for long-term agreements to vend power, as per Chief executive officer at Abdul Latif Jameel’s energy unit, Roberto de Diego Arozamena.
Chile, Mexico and Peru provide strong potential for expansion in renewable energy, and governments in the region are courting international investors to assist diversify the electricity mix.
The Saudi company obtained in 2015 the Spanish solar developer Fotowatio Renewable Ventures, which arrived with around 3.8 gigawatts of projects in developing solar markets including Australia, Africa, the Middle East and Latin America.
Abdul Latif Jameel Energy is presently generating around 5 gigawatts of renewable energy projects world wide, with 30 percent in Latin America.
“Latin America is an important market, where costs of renewables are declining and governments are giving support,” Arozamena stated in a telephone interview from Dubai. “We are eager to grow in the region.”
The Saudi company’s renewable-energy push arrives as the kingdom looks to meet a aim planned in 2016 of generating 70 percent of its power from natural gas and 30 percent from renewables and other sources by 2030. OPEC’s largest producer is among crude exporters struggling with budget deficits after oil prices refused.
Gas and oil supplied all of the country’s energy in 2015, as per Bloomberg New Energy Finance.
The government is now creating a programme to give subsidies for rooftop solar, and an auction previous year held as part of the National Renewable Energy Program drew headlines for a record low bid for solar power – $17.9 every megawatt-hour.
Investments in Latin America’s clean power market increased 65 percent to $17.2 billion previous year, much greater than the global average of 3 percent, as per Bloomberg New Energy Finance. That compares to a 26 percent refuse in Europe and less than 1 percent growth in the U.S.
An analyst at Bloomberg New Energy Finance, Ethan Zindler states, “We are seeing more and more large, international European power companies in Latin America.”
Mexico’s booming clean-energy projects have put the country neck-and-neck with the regional leader Brazil in the race for investments. Spending in Mexico increased more than sixfold to $6.17 billion previous year amid a national push to open the country’s gas, power and oil markets that spurred competition after decades of state monopoly.
Abdul Latif Jameel Energy stated on Tuesday it attached financing to begin development of a 342-megawatt solar project in Mexico this year, its first in the country. In Chile, it was awarded a hybrid project that will power about 224,000 Chilean homes with 100 megawatts of solar capacity and 100 megawatts of wind.
The company is wary about Brazil, because of the fluctuating currency and the lack of dollar-denominated contracts, and Argentina, which is still views as risky, Arozamena stated.
Arozamena mentioned, “We have a strong pipeline in Latin America and will focus on solar and wind.”
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