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In Latin America photovoltaic (PV) solar plants are more common than concentrating solar power (CSP) plants.
Both systems use sunlight – an abundant resource in the region – to produce electricity and, depending on capacity, require a large amount of land.
PV plants, which convert sunlight directly into electricity, are seen as particularly attractive as installation and running costs are relatively low.
PV solar is proving to be competitive with conventional energy sources, even in subsidy-free markets like Chile, whose solar segment has emerged as the gold standard for the rest of the region to follow.
CSP plants use mirrors to concentrate, or focus, the sun's energy and convert it into heat to create steam to spin a turbine that generates electricity.
CSP plants employ one of the following systems: trough, power tower or dish/engine.
No longer on the margins of the power sector, developers of both PV and CSP solar energy systems in Chile are now able to secure long-term power purchase agreements with distributors as a result of falling costs and renewable-friendly reforms to the power auction system.
This means that solar generators can more easily secure financing from multilateral development banks and, increasingly, from commercial lenders too.
The world's largest solar players – including Enel Green Power, SunEdison and China's Yingli – have taken notice of the potential of countries such as Mexico and Brazil, and are increasingly allocating resources to these countries and the region as a whole.
Major players in the industry are eyeing or breaking ground on projects in the region, which boasts tremendous solar resources and attractive electricity prices. Although they generally shy from the level of subsidization common in other regions, many Latin American governments are nonetheless eager to promote renewable energy.
Several countries have accumulated large pipelines of solar energy system projects at various stages of development.
The region this year surpassed the 1GW mark for installed solar capacity.
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