IEEE Power & Energy Magazine - September/October 2016 - 39

mission charges for small generation units. honduras has
installed 300 mw of photovoltaic farms, with rates around
Us$180/mwh, through long-term contracts and tax and fiscal incentives. these values are well above the last tender
in panama in 2015, where values of Us$80-Us$90/mwh
were obtained (slightly higher than those achieved in Brazil
and chile of Us$77/mwh). these examples show that stable values for photovoltaic and wind tech nology have
not yet been achieved in the region. this instability is producing some demand to renegotiate contracts signed with honduras
in 2014.
the incorporation of ncres
is growing rapidly under the farms
scheme, connected to transmission
and subtransmission networks
and, to a lesser extent, to distribution networks of medium voltage.
most of the countries analyzed
in this article have experience in
renewable energy auctions. such auctions are the primary regulatory instrument
used for deploying ncres in Latin america.

Central America and Panama:
Evolution of NCRES Regulation
and Allocation of Transmission
Network Charges
even larger-for photovoltaic in chile, for
y
db
se
example, and wind energy
en
lic
es
g
ima
in Uruguay. Both countries have
suffered energy deficits due to the interruption of natural gas (nG) supplies to chile and
the power supply to Uruguay from argentina. additionally, argentina has suffered an important deficit in its energy
matrix since 2007.
another example is Brazil, the largest country in Latin
america. Brazil opted for an auction mechanism, where it is
possible to buy power and/or energy through long-term contracts. By means of this mechanism, today Brazil has installed
more than 7,000 mw of wind energy, representing 5% of its
energy matrix. Using similar auction mechanisms, chile established a mandatory percentage for energy distribution companies and, as a result, has more than 2,500 mw of photovoltaic
and wind energy, covering 10% of its energy matrix in 2015.
in the case of central america, panama and el salvador
encouraged the incorporation of wind farms and photovoltaic
due to high fuel prices and a hydro generation deficit. these
generation types are sold on the spot market in panama,
with fiscal and tax incentives and the exemption of transg

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NCRES in Central America
central america is composed of seven countries: Belize,
costa rica, el salvador, Guatemala, honduras, nicaragua,
and panama. except for Belize, which is an english-speaking
country, all are linked by language, history, and culture. in
addition, they share an agreement creating a regional electricity market (mer, as its acronym is written in spanish).
currently, just two countries (costa rica and honduras) still
remain vertically integrated in their electricity markets. however, after enactment of its General electricity industry act of
2013, honduras is undertaking a restructuring of its electricity sector.
in 2015, mer's maximum power demand was 7,481 mw.
energy demand was 46,377 Gwh, led by Guatemala
(9,398 Gwh) and followed by panama (9,358 Gwh), costa
rica (8,901 Gwh), honduras (8,368 Gwh), and el salvador (6,291 Gwh); nicaragua had the lowest consumption
(4,061 Gwh).
mer is a seventh autonomous market, based on the
standards of regional level; these standards are mandatory rules approved through a regulatory agency called the
regional commission electric interconnection (crie).
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