• Neoen’s El Llano solar project in Mexico has had to halt production after CENACE ruling put it out of operation
  • The French company expects monthly EBITDA loss of up to $2 million a month due to this temporary shutdown
  • Neoen says the project was at pre-operational testing stage with CENACE before it was grounded

French renewable energy company Neoen has announced its 375 MW El Llano Solar Farm has stopped sending power to the grid in Mexico after the country’s system operator Centro Nacional de Control de Energia (CENACE) issued a ruling to this effect owing to COVID-19.

The Mexican agency has indefinitely suspended operations and critical tests for solar and wind power projects in the country since May 3, 2020 for an indefinite period due to reduced electricity demand because of the pandemic (see Mexican Solar & Wind Projects Come To A Standstill).

Neoen’s 375 MW PV facility has come in the line of fire for this decision. Construction on this facility was completed earlier this year and the project was at pre-operational testing stage with CENACE as it was injecting power to the grid since February 2020. Power was being sold in the spot market with Neoen claiming the project generating some of the world’s most price-competitive electricity of less than $19 per MWh.

“The EBITDA shortfall caused by the temporary shutdown of its El Llano facility is estimated at up to $2 million per month. Neoen stands ready to put the El Llano power plant back into service to recommence injecting power to the grid and resume pre-operational testing as soon as CENACE lifts its suspension,” said the company.

The project is contracted under a long-term power purchase agreement (PPA) that’s due to come into effect early July 2020. Chinese EPC company PowerChina HuaDong Engineering Corporation has deployed LONGi Solar’s 191 MW monocrystalline solar modules for some part of the project.

Neoen Mexico PV Project Off Line