Dr. Alberto Valdés Palacios
View from the Top

Association Re-Energizes Sector Growth

Wed, 02/24/2016 - 12:33

Q: How has ANES contributed to the development of the Mexican solar energy industry in the past two years?

A: ANES has actively participated in the drafting of norms for solar thermal collectors because it is aware of the importance of quality components. We are involved in many regulatory committees, including the one that works on the official norm for solar thermal equipment. This norm intends for all thermal equipment to comply with quality standards and be certified by noted laboratories in the country. Once this is accomplished, we will work on the regulations for photovoltaic systems and we will start by supporting the construction of the necessary infrastructure, which entails the laboratories that will carry out the quality tests. The government cannot issue a norm if there is a lack of infrastructure to enforce it, so we must aid in this endeavor by supporting the development of the laboratories. We already have five running laboratories for solar collectors and we expect the same for PV systems.

Q: What areas must be addressed in order to encourage financial institutions to see the solar sector in a favorable light?

A: Historically, banks that have given credits to renewable energy projects have seen solar as a risk venture. This is primarily due to the misconception that the technology has yet to reach a mature stage, and this is why we need certified, high-quality equipment in the market in order to dispel these false impressions. The installation process plays an important part in reducing risk, because even if a great piece of equipment is used in the project, it will not perform optimally if installed incorrectly. This area is being addressed by the committee through the management of renewable energy competencies, where it helps certify the people in charge of installing the equipment. Certifying the equipment and installers will provide certainty to investors and financial institutions. Another route to ensure financing is to have an investor provide a certain amount of money as a guarantee in order to reduce interest on loans. This would ultimately lead to reducing the high rates and the risks that have been stunting the solar sector’s growth.

Q: What are the advantages of developing a local manufacturing base, and what have been the major barriers hindering its creation?

A: Linking the supply chain would create a considerable advantage for Mexico, namely the creation of jobs. The Energy Reform addresses the inclusion of local components in equipment by initially establishing a 25% quota, which will progressively increase until it reaches 35%. In the past, the absence of a strong solar market was justified by the lack of a national supply chain, but now the tides are turning. There is a thriving market and players such as Solartec and IUSASOL have established two manufacturing sites. There are many foreign companies that are eyeing the possibility of establishing a plant in Mexico for the purpose of selling to the US. Mexico is now a strategic location for solar technology, not only due to NAFTA, but also because of its access to the burgeoning markets of Central and South America. It is a well-known fact that the country with the best fiscal options will get the attention of foreign players. Competition between states will be tough and some states, such as Chihuahua, Sinaloa, Guanajuato, and Queretaro, are already rising to the occasion. These states are aware of the benefits that foreign companies with manufacturing on the ground can bring, particularly job creation. These foreign players that are eager to venture into the Mexican market then approach ANES for advice. Firstly, we tell them to learn about the country and establish business alliances. It is important to have local partners because they will guide the company around the legislation process and the complexities of the market. The national players will also offer the international company an established distribution channel and a market niche.

Q: How will ANES re-energize the interest in solar and position the sector at the forefront of renewable energies?

A: The association is building a training center that will include webinars in order to cater to our regional divisions in all the Mexican states. It will be an important platform that will reach every state in the country and we plan on offering it to our corporate associates and affiliates. We are also thinking about building a showroom so that our associates can display their products. Additionally, we want to have an annual commercial forum in order to foster networking and business opportunities among members.