May 8 (Renewables Now) - Mexican federal competition body Cofece has come to the defence of renewables against the recent decision by electricity system operator CENACE to indefinitely suspend performance tests for new wind and solar farms while the country deals with the COVID-19 health crisis.
Last week, CENACE blocked tests required for wind and solar power projects to start commercial operations, singling out their intermittent nature as a threat to the system stability in the context of lower electricity demand during the COVID-19 lockdown.
In a statement on Thursday, Cofece said that some provisions in the new rules for wind and solar connections could interfere with free competition, increase electricity prices and raise federal government subsidies on tariffs.
The CENACE decision does not establish clear and measurable criteria for the tests to resume, denying the plants their access to the market indefinitely, the statement reads.
The rule not only creates uncertainty for investments in future projects, but also for wind and solar farms currently in operation. It could be interpreted that the dispatch order would favour conventional power plants while limiting wind and solar farms, the competition authority argues.
Cofece said it had sent its opinion to energy secretariat SENER, energy regulatory commission CRE and CENACE along with recommendations for the revision of the rules. It suggested that any new measures by CENACE for operating wind and solar farms should be based on strict technical criteria and directly linked to the stability of the electricity system.
It further said that the plant dispatch order should be based on generation costs, from lower to higher, since competitive prices gain more importance during the health crisis.
Additionally, CENACE should define the criteria by which it will suspend its measures and set rules on when the tests can resume.