Biomass a Reliable and Cheaper Alternative for Heating

Q: What is the history of Ignus Energy and what does it specialize in?

A: I was involved in photovoltaics for bigger players in Mexico but wanted to start my own company. I saw an opportunity in the renewables segment related to heat because no players were offering heat as a service. This is common in other parts of the world, but no company in Mexico is doing this. I joined forces with Inventive Power, which is focused on concentrated solar. After analyzing the market, we saw the opportunity to implement biomass as a fuel, which can replace all other fuels used by potential customers. If they were using liquefied petroleum gas, diesel or heavy fuel we would change the burners and simply switch to biomass, which clients can generate through their own waste.

Overall, we have experienced more growth in biomass than in solar in terms of our business, even though I would like to see more work in concentrated solar. We have two biomass projects running, with a third one just starting. We also installed a concentrated solar system last year. Ignus targets companies all over the country, such as those in Yucatan where no natural gas is available. There, the proposition is additionally attractive because our solution is not only the most environmentally friendly but also has the lowest cost. However, most of our clients are located in Mexico City, considered our home base, or in nearby states such as Mexico State and Queretaro.

Q: What does the company consider to be a success story in terms of its projects?

A: One major project was our work at the Hércules brewery in Queretaro where we implemented all our technology: a solar heating system that included piping and valves. We are heating their water using the direct sunlight as a basis. The first process in beer making is the mashing process, which does not require backup heat. The water is heated up to 90 degrees and then cooled down to around 70 degrees for the mashing process to begin, without turning on the biomass boiler. This comes into play for later processes. We developed a web platform where the company can track its processes and their efficiency, as well as allow for comparisons with industry and theoretical benchmarks. The client can also see where the production process can be improved, which is a major added benefit. Our showroom has screens that display in real time how much biomass is being consumed and how much solar energy is being generated.

Q: How does the company apply this tracking software?

A: We track how and where temperature and pressure is lost. We try to implement big data analytics, using cheaper sensors. Sensors measuring steam flow tend to be especially expensive, for instance. Therefore, we compensate for the lack of such data by collecting different, related data through a variety of cheaper, imported sensors. Using this, we can provide data analytics at much cheaper prices than Armstrong International, which offers quality software and equipment but at an incredibly high price that is often only attainable by the very big companies. Ignus focuses on tracking data but does not operate processes through the platform. This is an interesting future perspective the company is working on.

Q: How can clients save on energy costs through the company’s clean heat purchasing agreement (HPA) solutions?

A: Biomass can substitute more expensive fuels such as LPG, propane, diesel and some heavy oils, although other oils can be obtained at a lower cost due to the fall in oil prices. We had to postpone some projects because investors are uncertain for this reason. For our solar solution, we can extend our contracts to reduce energy prices. We are negotiating the sale of natural gas molecules with an industrial partner, which will run between 15 and 20 years. The price for the molecules is the cheapest available because pipeline natural gas is not available in the southern state where our partner is located. We consider that to be the most attractive part of our flexible HPA solution: having a stable, discounted price for energy.

Q: What do you consider are the effects of the government’s policy direction on heat-based renewable processes?

A: The current government is focused on promoting its own oil and gas company. Nonetheless, we have not been affected directly by the latest rulings and legal processes like utility-scale projects have been. Bureaucratic processes have not really changed in any way. However, we have felt a lack of investment interest related to our processes. Our pool of investors, who are mostly Canadians, were much more enthusiastic about Mexico’s investment potential six years ago. Most of the company’s funding comes from private investors. A special purpose vehicle to fund more projects has been put on hold during the pandemic.

Q: What are Ignus’ goals for the near term?

A: Our growth forecast got hammered in 2020 due to the pandemic. We delivered only one turn-key project this year, which was focused on biomass. During the lockdown, projection growth was difficult because our expectations were smashed. We will finish the year with one turn-key project and one HPA with a pallet manufacturer, where we hoped to be working on at least six projects. We believe that signing more contracts before the end of the year will be difficult. For the year to come, we have more promising projects in the pipeline. Even though some of these might not go through because of the challenging situation the sector finds itself in, there are still companies willing to switch to our solutions.

Ignus Energy develops biomass heating systems, after which it signs long-term contracts to sell heat as a service to customers. The company further helps its clients to implement biomass and concentrated solar power to fuel their operations.