Solar energy in the tropics
Central America's solar energy market is luring global companies to invest, as the region is set to install 1.5 Gigawatts through 2018, according to a report published this month by IHS Technology.
For this year, total photovoltaic capacity for the six countries in the region is expected to reach 22 Megawatts.
But for the following year, the capacity is seen taking a leap to 243 Megawatts.
“About 70 percent of the electricity generated in Central America already comes from renewable sources, mainly hydro,” said Josefin Berg, senior analyst for solar demand at IHS.
“Yet over the past few years, increasing power demand has been met with new thermal generation thanks to power generated from oil, coal and gas, increasing reliance on fossil fuel imports. To counteract this and to avoid future volatility in electricity pricing, governments have begun supporting the controlled deployment of renewables.”
El Salvador is one of the countries reaching a milestone after it was awarded a 94-Megawatt solar project.
In May of this year Guatemala's president Otto Pérez Molina inaugurated the region's largest solar farm, with an installed capacity of 5 Megawatts that will power more than 24,000 homes.
The project is led by Spain's Gransolar, Guatemala's Grupo Green (only in Spanish) and Swiss investors Eco solar.
Also in May, U.S.-based Smartsolar announced its plans to invest $20 million in Honduras.
Although the company specializes in solar powered farm products, in Honduras the aim is to get larger companies and factories, as well as homes, to install solar panels.
The company hopes to create up to 5,000 jobs in the country.
The region is also focusing on smaller-scale projects, such as hotel owners and local commerce, Berg said.
One of the biggest challenges is that each country differs in terms of regulations and structure in its energy sector.