Solar panel developer and manufacturer SunPower plans to spend around US$1.5 billion on 1GW of solar projects in Chile over five years, the company has confirmed.

A SunPower spokesperson said the company expects long-term growth in Chile’s solar market due to its strong solar resources, access to capital and transparent rules and regulations.

Adam James, GTM Research senior solar analyst, told PV Tech that SunPower is making a strategic shift from merchant projects, such as its 70MW PV Salvador project, to the auction process and bilateral market.

He added that this is consistent with GTM’s expectation that future solar demand will come primarily from auctions and the sub-5MW bilateral market in coming years, due to changing wholesale market conditions.

James said that since Chile’s previous auction, tenders have been divided into different time blocks rather than just for certain GWh of production. This accounts for different height-of-production times, which means solar firms can capitalize on their peak production times and offer more competitive bids.

James added: “While we do anticipate future demand for solar will be lower than in 2015 and 2016, Chile remains a strong contender in Latin America, ranking in the top three countries for utility-scale PV development out to 2020.”

“SunPower's heightened ambitions in Chile is a testament to the strong fundamentals for solar in the country.”

The latest figures from Chile's renewable energy research institute Centro para la Innovación y Fomento de las Energías Sustentables (CIFES) show Chile installed 16MW of solar PV in June with operational capacity now standing at 553MW, up from 537MW the previous month.