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Barriers to Developing Solar Energy in Mexico and Egypt

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Barriers to Developing Solar Energy in Mexico and Egypt Barriers to Developing Solar Energy in Mexico and Egypt PhD. Dissertation BRUNO BERNAL TRUJILLO Pamplona, 27th April 2021 Barriers to Developing Solar Energy in Mexico and Egypt A dissertation submitted by: Bruno BERNAL TRUJILLO for the degree of Doctor of Philosophy. Supervised by: Dr. Fernando PÉREZ DE GRACIA HIDALGO Dr. Juan Carlos MOLERO GARCÍA. Dr. Fernando PÉREZ DE GRACIA HIDALGO Dr. Juan Carlos MOLERO GARCÍA. Acknowledgement I greatly appreciate the help given to all my colleagues at Eosol, especially Javier Oliva, Ivette Villalobos, José Pellón, Fermín Gembero, Hamza Amselem and Mahmoud Abdelbar. I also thank Fernando Perez de Gracia and Juan Carlos Molero García who did not let me give up the many times I was about to do so in these long years. But this PhD belongs without a shadow of doubt to my father, who made me promise I would study the doctorate. He cannot see it because he has sadly passed away, but I know he knows I would achieve my goal. Thanks dad, I will see you again. General Index 1. INTRODUCTION ....................................................................................... 1 1.1 Introduction ....................................................................................... 1 1.2 References ......................................................................................... 7 1.3 Glossary ........................................................................................... 23 2. BARRIERS FACING THE SOLAR PHOTOVOLTAIC SECTOR IN MEXICO 27 2.1 Introduction ..................................................................................... 27 2.2 An Overview of the Energy Sector in Mexico ................................ 28 2.2.1 Regulatory Framework ............................................................. 28 2.2.2 Electricity Production ............................................................... 30 2.2.3 National Electrical System ....................................................... 32 2.2.4 Evolution of grid capacity ........................................................ 32 2.3 The Photovoltaic sector in Mexico ................................................. 35 2.4 Barriers to the development of photovoltaic plants ........................ 38 2.4.1 Barriers in the case of Mexico ................................................. 39 2.4.2 Barriers to obtaining permits .................................................... 40 2.4.3 Land barriers ............................................................................ 45 2.4.4 Commercial barriers ................................................................. 47 2.4.5 Congestion problems in interconnection infrastructures .......... 50 2.4.6 The special barrier of financial services ................................... 51 2.4.7 Spot market functional change ................................................. 53 2.4.8 Operational barriers .................................................................. 63 2.5 Governmental involvement ............................................................. 80 2.5.1 Government initiatives to foment development in the renewable energy sector ..................................................................................... 81 2.5.2 Government initiatives to stop development of renewable energy ................................................................................................ 87 2.6 Conclusions to be drawn from the barriers in Mexico .................... 99 3. IMPACT OF FOSSIL FUEL PRICES ON ELECTRICITY PRICES IN MEXICO ........................................................................................................... 103 3.1 Introduction ................................................................................... 103 3.2 Related literature review on fossil fuel prices and electricity prices ............................................................................................................. 105 3.3 Overview of the electricity sector in Mexico ................................ 106 3.3.1 Institutional and regulatory framework .................................. 106 3.3.2 Supply and demand ................................................................ 108 3.4 Dataset and a first look at the data ................................................ 110 3.5 Empirical analysis ......................................................................... 113 3.6 Impact of fossil fuel prices on electricity prices in Mexico conclusions .......................................................................................... 121 4. BARRIERS TO THE DEVELOPMENT OF THE SOLAR PHOTOVOLTAIC SECTOR IN EGYPT ............................................................................. 122 4.1 Introduction ................................................................................... 122 4.2 An Overview of the energy sector in Egypt .................................. 123 4.2.1 The influence of Egypt in the energy sector in the surrounding areas ................................................................................................. 126 4.2.2 Regulatory framework ........................................................... 129 4.2.3 Electricity production ............................................................. 133 4.2.4 National Electrical System ..................................................... 135 4.2.5 National electricity consumption ........................................... 136 4.2.6 Decommissioning plan and installed capacity ....................... 138 4.2.7 Evolution of grid capacity ...................................................... 139 4.3 The photovoltaic sector in Egypt .................................................. 144 4.4 Barriers to the development of photovoltaic plants ...................... 147 4.4.1 Barriers in the case of Egypt .................................................. 148 4.4.2 Permit barriers ........................................................................ 149 4.4.3 Land and social barriers ......................................................... 153 4.4.4 Commercial barriers ............................................................... 154 4.4.5 Interconnection barriers ......................................................... 155 4.4.6 The specific barrier of financial services ............................... 156 4.4.7 Taxes ...................................................................................... 157 4.4.8 Other barriers ......................................................................... 158 4.5 Governmental involvement ........................................................... 161 4.5.1 Government initiatives to foment development of the renewable energy sector ................................................................................... 161 4.5.2 Government initiatives to stop the development of renewable energy .............................................................................................. 163 4.6 Case studies ................................................................................... 164 4.6.1 Solar irrigation company case ................................................ 165 4.6.2 International Cement Company case ..................................... 167 4.6.3 The case of a big Real Estate Contracting Company (BRECC) case .................................................................................................. 168 4.6.4 The case of the three farms project ........................................ 169 4.6.5 Poultry project case ................................................................ 170 4.6.6 The case of the Libyan owners project .................................. 171 4.6.7 The case of the ceramic factories project ............................... 172 4.7 Egypt Barriers Conclusions ........................................................... 173 5. FINAL CONCLUSIONS .......................................................................... 177 5.1 Conclusions ................................................................................... 177 6. ANNEXES OF THE THESIS .................................................................... 181 6.1 Annex: Management to generate electricity within the law transition process ................................................................................................. 182 6.2 Annex: Environmental impact assessment (EIA) ......................... 183 6.3 Annex: Local municipal management with the competent authorities ............................................................................................ 184 6.4 Annex: Procedures related to the social impact of the project ...... 185 6.5 Annex: Suspension pre-operational tests for wind and photovoltaic installations ......................................................................................... 186 6.5.1 Suspension Pre-operational tests for wind and photovoltaic installations ..................................................................................... 186 6.5.2 Violation of the Must-Run Power plant designation procedure ......................................................................................................... 189 6.5.3 Deviation from the Country's Environmental Objective ........ 190 6.5.4 Provisional and Definitive Suspensions of this Initiative ...... 191 6.6 Annex: Legal procedure that the COVID initiatives ..................... 193 6.6.1 The Legal procedure that the initiative should have followed for its approval and ordinary publication .............................................
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