Mexico eliminates 15% customs duties on solar module imports

Mexico's Federal Court of Fiscal and Administrative Justice announced at the end of last week that it has eliminated the 15% customs duty on solar PV module imports, which the Mexican Tax Administration Service (SAT) introduced in 2015.

The court accepted an appeal lodged by the Mexican solar association, Asolmex in October 2016, where it said the duty was illegal, following the claim by SAT that solar modules were themselves power generators, rather than components within a larger power system.

“Asolmex celebrates the resolution of the Court, since the conditions of legal certainty are restored to the sector and guarantees the competitiveness of solar energy in Mexico,” the association said in a statement.

The elimination of the duty, combined with the expected solar module price drop, due to recent developments in the Chinese PV sector, may spur further growth in Mexico both this year, and next. It may even lead to the resumption of abandoned solar projects, which were selected in Mexico’s power auctions over the last three years.

In a recent interview with pv magazine, the general secretary of Asolmex, Israel Hurtado confirmed that several “unprofitable” projects may now again become interesting. “With much lower module prices, many initiatives could be restructured and refinanced. It must be remembered that the cost of the panels represents 50% of the total cost of a large solar project, and that a decrease of more than 30% of their prices could result in a project by at least 15% cheaper,” he said.

Furthermore, Hurtado believes that 2018 is on track to become a record year for the Mexican PV sector, as around 1 GW of new PV power could be installed in the country under the aforementioned improved conditions. “Our forecast for the next six years is 6.6 GW, but I do not exclude that this forecast can also be revised upwards if the forecasts of the BNEF will be correct,” added.