Market analyst, GTM Research, has predicted that Mexico will be Latin America’s most attractive PV market in 2014, despite an ever-growing solar pipeline in its nearest rival, Chile.

Mexico’s solar insolation rates of 5-7KWh per square metre a day, abundance of cheap desert land and a supportive government have led GTM to predict Mexico’s solar market will quadruple in 2014.

Thanks to legislation to reduce carbon emissions 30% by 2020 and a National Energy Strategy for 2013-2027 agreed in April with estimates that 6GW of solar energy could be developed by 2020, GTM forecasts installations to quadruple from 60MW installed to 240MW in 2014.

"Mexico is poised to be the hotbed for solar deployment in Latin America," said Adam James, GTM global solar analyst and co-author of GTM’s ‘Latin America PV Playbook’.

GTM highlighted how with natural gas supplies constrained in Mexico, but with GDP, population and energy demand all rapidly growing, there is huge potential demand for solar.  

Meanwhile, Mexico’s grid has been overbuilt by 50% to accommodate for anticipated growth and there is only one state-owned utility, the Comisión Federal de Electricidad (CFE), GTM said.

The report says projects approved as part of the Small Power Producers Program and residential demand, self supplied projects as well as new business models for leasing and community solar projects, had all added to the vast business potential in Mexico.

Year-on-year growth is expected, with 219MW currently under construction, nearly half of which is in the state of Baja California Sur. Other future growth states are Yucatan and Sonora, where plans for a total of 280MW have been announced.

But James said preventing solar deployment at the moment are “the complexities of local markets, financing and regulatory hurdles, and policy risk”, but companies who understand the risks of the specific markets, and have the tools to exploit the smaller opportunities will be positioned competitively as the market matures.