SunEdison and its emerging markets yieldco, TerraForm Global, are relying on Latin America to bolster its pipeline.
A week after GTM Research published its Q2 2015 Latin America PV Playbook, one of the company’s senior solar analysts has expounded on how the region is going to be a vital location for the growth of SunEdison, and in particular its newest yieldco, TerraForm Global.
Adam James, who is a senior solar analyst with GTM Research and is the lead author of the regularly-published Latin America PV Playbook, wrote a blog post on Green Tech Media’s website this week, explaining “why Latin America is the most attractive market for TerraForm Global”.
The Playbook, released last week, highlighted Latin America’s record 363 MW of new utility-scale solar that it brought online in the second quarter, and its 61% increase on project construction. Honduras was the leading developer in the region, with 307 MW brought online across 7 separate projects in the quarter, but Chile, Panama, and Brazil also played their part.
But according to Adams, in terms of developers, SunEdison’s cumulative market share of the utility-scale PV market in Latin America stood at 25% by the end of the second quarter, installing 30% of the capacity in the region in four different quarters over the last 18 months, and at one time accounting for a phenomenal 75% of the installed market in a single quarter.
However, James and his colleagues do not believe that SunEdison will be able to hold on to its total dominance, with the rise of challengers like Cohessa and Upower spelling a rise in competition.
Why, therefore, if there is an ever increasing chance of growing competition, is TerraForm Global so interested in the Latin America region? Why, as Adam James wrote, “did SunEdison President and CEO Ahmad Chatila spend about a third of his time talking about Latin America on the company’s last earning call?”
With TerraForm Global set to focus on emerging markets, the answers are quite simple. As Adam James explains:
Latin America is the most attractive region in the world for TerraForm Global. The solar project pipeline in the region is packed with opportunities. There are over 450 early-stage projects across Latin America, representing a 27-gigawatt pipeline, with about 90 percent concentrated in Chile, Brazil, and Mexico and a further 2.5 gigawatts in the next six countries (with over 100 megawatts in each).
Figures released by GTM Research earlier this year showed that the solar PV market in Latin America grew by 370% in 2014, installing a total of 625 MW. Jump back almost a year to September when NPD Solarbuzz predicted that the Latin America and Caribbean region is set to install 9 GW of solar PV over the next 5 years.
Latin America and Caribbean Five-Year Cumulative Demand Forecast by Project Status
“Solar PV is now starting to emerge as a preferred energy technology for Latin American and Caribbean countries,” said senior NPD Solarbuzz analyst, Michael Barker, at the time. “The region has high electricity prices and it also benefits from strong solar irradiation, which makes it a good candidate for solar PV deployment. As a result, experienced global solar PV developers are seeing strong solar PV growth potential in the region.”
So it should come as no surprise that TerraForm Global, intent on developing itself as one of the world’s dominant solar developers in emerging markets, is so focused on Latin America.
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