PV watchers are in for a disappointment after it emerged that an auction result reported as the cheapest price for solar ever was actually a price for wind.

News outlets, including GTM, rushed to celebrate what Electrek reported was a record low price of $17.70 per megawatt-hour for solar energy on the release this month of the preliminary results of Mexico’s latest auction for energy, power and clean energy certificates. 

The preliminary results announcement from Mexico’s National Energy Control Center (Centro Nacional de Control de Energía or CENACE in Spanish) listed the price among four lots adjudicated to Enel, the Italian energy giant, but did not specify technologies.

Wind analysts were quick to note that the figures for clean energy certificates (certificados de energía limpia or CELs) figures didn’t make sense for solar.

“When CENACE published its initial press release, it was evident that these four sites were likely wind power,” said Brian Gaylord, senior analyst for Latin America and Southern Europe at MAKE Consulting.

“In order to add up the amount of power and CELs sold per the figures, these four projects with Engie's eolica [wind]-labeled site yielded a matching sum," he said.

Further confirmation came with the publication of detailed information from CENACE and a press release from Enel.

“Enel, through its renewable energy subsidiary Enel Rinnovabile, has been awarded the right to supply energy and clean certificates with four wind projects for a total capacity of 593 megawatts in the country’s third long-term public tender,” the energy company stated.

The win consolidates Enel’s position as Mexico’s leading renewable energy developer, said the firm. Enel will be investing $700 million in Mexico to help complete the plants, which are expected to enter operation in the first half of 2020. 

Three of them, Amistad II, III and IV, are due to be built in Acuña, in the northern state of Coahuila. Amistad II and III are 100-megawatt plants, while Amistad IV is slated to be 149 megawatts. Enel started building the first Amistad wind farm in March.

A fourth plant, the 244-megawatt Dolores project, is planned for the China municipality in Nuevo León, a state in northeastern Mexico. 

The projects will almost double Enel’s existing 675 megawatts of wind power in Mexico, but represent only a fraction of the renewable energy capacity the company has in its pipeline for the country.

Enel already also operates 53 megawatts of hydro power in Mexico, and aside from the Amistad and Dolores projects is developing an additional 293 megawatts of wind and 992 megawatts of solar generation capacity, including Latin America’s second-largest PV plant.

The developer is planning to put all of its renewable energy projects into a special-purpose vehicle that will be 80 percent owned by the Canadian institutional investor Caisse de dépot et placement du Québec and the Mexican pension fund CKD Infraestructura México. 

The confirmation that all of Enel’s winning bids in the latest auction round were for wind projects means the lowest price achieved by solar in Mexico was actually $19.70 per megawatt-hour, for an 80.3-megawatt plant from Mitsui and Trina.

The price represents a new record for Latin America after the most recent auction in Chile saw Enel bidding $21.48 per megawatt-hour of solar power on one sub-block of capacity. It isn’t quite the cheapest worldwide, though.

That honor still belongs to a tender for 300 megawatts of solar power in Saudi Arabia, in October, which saw Abu Dhabi developer Masdar offering a price of $17.86 per megawatt-hour. Nevertheless, solar carried the day in Mexico in terms of capacity granted.

The technology took more than 55 percent of capacity on offer, totaling 992 megawatts, in nine out of 14 energy lots.

The auction, Mexico’s third, was the first to include a pre-qualification process, which GTM Research Americas solar analyst Manan Parikh said was likely a sign that the country was tightening up on renewable energy procurement. “It’s a way to keep people honest,” he said.

“Initially they had this permitting scheme, which has since been scrapped, and anyone could come in and say, ‘I want a permit,’" he said. "People would just sit on these permits and do nothing with them.”

The move to auctions seems to have brought a new level of integrity to the proceedings -- even if there is still the possibility for confusion about who is bidding for what. 

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