## 2 Literature Review
### Solar Energy Potential, Regulations, Solar Resource and Costs in Mexico  
Since the publication of the first interconnection contract for small-scale solar energy sources, as well as the entry into operation of the first large-scale photovoltaic plant in 2011, the installed capacity of solar energy increased, and this increase has been reinforced by the significant growth of the linked interconnection contracts (small and medium scale), in which since 2011 (Figure 2) a significant growth up to 2020 of 1388 MW can be observed [30].  
In Figure 3, estimates are shown made by SENER (Ministry of Energy) and CRE (Energy Regulatory Commission), where it is projected to install between 9179 and 13,869 MW by 2035, distributed generation solar photovoltaic systems [30; 31].  
Figure 2: Evolution of installed solar power capacity in Mexico in MW [30].  
The legislation for the On Grid-PV Systems in Mexico was published in 2007 in the Official Journal of the Federation [33]. This regulation allowed residential and commercial users to connect to the Federal Electricity Commission (CFE) grid with the use of On Grid-PV (RES/176/2007) for electricity generation. The connection to the CFE grid is to supply the energy generated by the installed panels and thus exchange energy with the CFE through bi-directional energy meters. The low voltage limit was set at 10 kW for residential use and up to 30 kW for commercial use, and this allows users to contribute with their electricity generation from a small proportion of their total energy consumption in their electrical installation [34].  
Currently, the regulations to be complied with for this type of system are described in the following laws: the Electric Industry Law [35], the Electric Power Public Service Law [36], the General Law on Climate Change [37], the Electric Transition Law [38], the Mexican Official Standard NOM-001-SEDE-2012 [39], and The CFE Specification G0100-04 for the interconnection to the low voltage electric grid of photovoltaic systems with capacity up to 30 kW [34].  
The solar resource potential in Mexico stands out because the annual amount of solar radiation received is higher than that of other countries. Mexico is located in the so-called global maximum irradiation belt, between 30 north and 30 south latitudes, which makes the amount of solar radiation high throughout the national territory, with an average of 5.5 kW/m\({}^{2}\)/day [40,41]. In the structure of primary energy production, the Ministry of Energy (SENER) reported that only 2.8% of the national energy produced is obtained from sources such as geothermal, solar and wind. In this sense, the renewable sources that increased their participation in the gross domestic energy supply in 2018 were solar (58.20%) and wind (23.2%). Thus, the net generation of electricity with self-sufficient solar energy in 2018 was 327.77 GW/hour [40].  
Despite the low diffusion of photovoltaic technology, it is very important to note that, over the last 10 years, it has increased favorably, incorporating even more users, and in the aforementioned data collection period production increased from 872.40 kW to 53,170.53 kW in 2019. This is a reflection of the increase in electricity tariffs, which are expected to rise by up to 50% in 2022, before softening in 2023 and 2024 [41].  
On the other hand, the decrease in photovoltaic technology brings solar panel prices down from 5 USD/Watt to 1 USD/Watt and makes these investments attractive; the interconnection scheme with CFE for cogeneration has boosted the photovoltaic solar industry in our country, and as of 31 December 2015, small and medium scale interconnection  
Figure 3: Estimated evolution of distributed generation capacity installed in Mexico, 2016–2035 in MW [31,32].  
contracts across Mexico reached up to 117.56 MW of installed capacity. It is estimated that, by 2022, 2.18 GW of small and medium-scale cogeneration will be reached [39; 40].