Uruguay is hoping to attract developers to build 200 MW of solar photovoltaic capacity, according to Bloomberg news.
The government has announced plans to invite bids to build PV plants and says that it will offer project developers a price of just $90 per MWh.
Energy from the PV plants will be purchased by national power utility Administracion Nacional de Usinas y Transmisiones Electricas (UTE) for 25 years. Developers will have four months to submit proposals and will be granted contracts on a first-come, first-served basis.
Solar radiation levels in Uruguay are similar to those seen in Spain and in parts of China, where $160 per MWh is the going rate for energy produced by PV plants.
The Uruguayan government believes that developers will not be put off by the low rate of compensation because of the recent falls in prices for solar equipment.
In 2011 an auction for wind power capacity in Uruguay attracted offers of $63 per MWh, slightly above levels seen in Brazil at the time that were the lowest in the world.
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