Access to US Market Makes Baja California Attractive

Q: What are the main priorities and objectives for the Baja California State Energy Commission during the current administration?

A: Until December 31, 2013, the appointment of the head of the Baja California State Energy Commission depended on the Ministry of Urban Development and Infrastructure. From January 2014, this responsibility will pass to the Ministry of Economic Development. The main reason for this change is that Governor Francisco Vega de Lamadrid is focusing on attracting companies and investors that are interested in power generation in Baja California. Other than validating and approving projects, we will have a renewed focus on promoting and facilitating companies to invest in the state.

Q: What are the main actions and policies being implemented to position Baja California as one of the pivotal states for renewable energy development?

A: We are seeking to provide companies with the right incentives to develop our important solar and wind energy resources. We are not looking for the state to invest in energy generation projects, but we want to take advantage of the already explored public-private partnership (PPPs) scheme, through which the state government can partner with a private entity. Q: What are the main challenges facing power generation in Baja California? A: We currently have a number of projects at different stages of development, with many of them being destined to export their electricity to the US. We are developing different schemes at the state level to help companies comply with the various requirements and permits. Overcoming our challenges depends on providing enough opportunities and facilities for investors to come to Baja California.

Q: How can renewable energy projects contribute to Baja California’s energy security?

A: The Energy Reform clearly states that the development of renewable energies will be a priority, and Baja California clearly has the right traits to develop such energies. Natural gas prices have been decreasing but that is no guarantee about where they will go in the future. Furthermore, increasing our reliance in natural gas would involve the development of a considerable amount of pipeline infrastructure while renewable resources are already present in the state. Investing in solar or wind is a safe bet.

Q: What is the strategy to replace highly contaminating power plants with clean energy generation plants?

A: The State Energy Commission is not focusing on power generation, which is CFE’s responsibility. However, clean energy generation is important for the environment, which is why we are focusing on attracting companies that want to develop our renewable energy sources. We have clear examples of the potential of clean energy generation right across the border, and Baja California has greater wind and solar resources than California. We need to take advantage of what Mother Nature gave us.

We are interconnected with the US grid, not the Mexican grid, and our largest base energy generation facilities are geothermal and thermoelectric. These plants have already been upgraded, so the need to make the transition from polluting power plants to clean power plants no longer applies to Baja California. We are now looking to complement that clean power generation as demand increases. The government does not have enough money to invest in the very expensive technologies that clean generation involves as it has many other priorities, this is why PPPs are so important.

Q: What are the main traits that differentiate Baja California from other states with high renewable energy resource availability?

A: Our geographical location is perfect for the development of our renewable energy industry as we are next to the US. In other states with similar potential, an investor could be interested in generating energy for local consumption but a greater incentive comes with the possibility of exporting that energy to a market like the US, whose demand keeps increasing. The moment to invest in these types of energies is now. Many studies confirm Baja California’s resource availability, investors have money and the state government is interested in supporting these projects.