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Insight

Catering to Self-Supply Demand for Solar Energy

Wed, 02/19/2014 - 12:21

2013 was a big year for the Mexican solar industry, mostly because the 30MW Aura Solar I came online in Baja California. The solar industry may still pale in comparison to the Mexican wind sector, but there is a lot of activity taking place behind the scenes. Kelly Desy, M+W Group’s Director of Business Development for Latin America, says that investors and developers have seen heightened activity in the solar sector. “Customers in both the industrial and commercial sectors are asking for on-site panels to supplement their energy supply, enabling them to use more solar energy and less energy from the grid, making them more self-sustaining,” she explains. The success of solar projects in the commercial sector has been price driven, she adds, while in the industrial sector it tends to be a matter of energy security, due to the occurrence of power shortages that affect production processes.

M+W Group is an engineering and construction partner for its clients, immersing itself in many different areas of the Mexican market, including pharmaceuticals, cosmetics and the food industry, working with clients such as Procter & Gamble and Coca-Cola. The company has developed the largest number of solar panel production facilities worldwide, and M+W Group is making solar energy a main component of its thrust into the Mexican market. The firm started out in the Mexican solar industry by building a solar panel manufacturing facility in Mexicali. This German firm divides its solar energy operation into two branches: large solar installations focused on providing electricity to utility companies, and rooftop installations mainly for self-supply purposes for commercial and industrial clients. One of the biggest benefits of the second approach is that it reduces engagement between clients and utilities, in Mexico’s case CFE. This dual approach enables the company to diversify its client base, which now ranges from large multinational firms to medium-sized company clusters in industrial parks.

Many international companies still doubt whether solar energy is a worthwhile investment. Companies generally want to have their facilities operating before considering the option of installing solar power, rather than incur more risks during the start-up of their facilities. Moreover, some companies do not want their operations to depend on solar energy and are more willing to invest in wind,” explains David Martínez, Managing Director of M+W México. However, utilizing wind energy also means depending on CFE, while solar panels offer more energy independence. Martínez says that the acceptance of solar energy has a lot to do with the profile of each client, as well as how their projects are financed. M+W Group offers turnkey solar projects, including design, solar panels and engineering, while guaranting that its customers will save money. Perhaps the most important aspect for many clients, the company helps them find financing. The company is looking at large scale solar parks to serve clients in the private sector. As Desy explains, larger parks can offer customers solar energy at more competitive prices. In addition, M+W Group explains to its clients that these solutions can be implemented with minimal CFE involvement and without having to deal with financial institutions. By fully understanding their situation and aspirations, M+W Group is able to offer its clients practical solutions, such as schemes in which several companies share a photovoltaic park. M+W Group believes that this strategy will lead to the company becoming a big player in solar energy for direct industrial clients. “In order to fully develop a domestic value chain, everyone involved in the sector has to promote solar power as an affordable and viable energy solution,” Martínez says.

Martínez compares the sector’s current situation to concrete pavements in the country 20 years ago. “CEMEX brought in the technology and equipment and then convinced everybody that this was a good option. Eventually, people started using it. CEMEX facilitated the entire process, and today 50-60% of pavements in Mexico are made of concrete. Similarly, we have to work together with developers, suppliers, contractors, and our competitors, to ensure that everyone knows what a great option solar energy is.” Desy expects to see more solar installations appearing as distributive generation systems on industrial facilities and rooftops, as well as more innovative and larger plants that provide energy on a large scale. “In 2014 we will see another giant step forward in the Mexican solar industry,” she concludes.