Zhang Chunnuan
General Manager
China Gezhouba Group Corporation
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Close Relationships Improve Knowledge of Tech Requirements

Fri, 02/01/2019 - 13:03

Q: What added value is China Gezhouba Group Corporation (CGGC) bringing to Mexico?

A: CGGC is a subsidiary of China Energy Engineering Group, with business lines in design, construction, investment and operation in hydropower, thermal, nuclear and wind power, power transmission and transformation. The group has other companies under its umbrella related to the development of products and services for energy projects such as China Power Engineering Consulting Group Corporation, the Electric Power Planning and Engineering Institute and China Energy Equipment, as well as with education institutions that have strong R&D departments. Having close relations with all of these players allows CGGC to improve its knowledge of the industry’s technology needs and best practices, as well with the trends that will shape the future of the global energy industry. While the company is already one of the biggest EPC companies in the world, with a strong presence in China and several projects in South America, we are looking to start proper activities in Mexico’s energy sector soon. Furthermore, a strong competitive advantage we possess is our ability to not only participate as an EPC but also as a financial entity to develop projects.
Q: What kinds of projects does CGGC want to develop in Mexico?

A: Worldwide we are one of the leading companies working in hydroelectric projects. Although we entered the country four years ago with the idea of developing these kinds of projects, we have witnessed a clear slowdown in that sector, as well as a strong push from the government for the development of renewable energy projects. As a result, we are now looking at solar and wind as the types of projects with the biggest opportunities.
Q: What role does CGGC want to play in the Mexican longterm electricity auctions?

A: Three long-term electricity auctions have come and gone, and all three have resulted in increasingly lower prices. We did not enter directly into the auctions because we are not accustomed to the market conditions in Mexico, which would have been a major hurdle for the construction of a viable business model. We may participate in the fourth long-term electricity auction but that will depend on our internal calculations and the partnerships we develop in the coming months. We are actively looking for local and international partners to make a bid.
Q: What is the profile of the partners CGGC is looking for in Mexico?

A: We are looking for two main types of partners. The first and most important is a local company that knows everything about Mexico and how to complete projects in the country, that has local talent and broad experience developing projects. Most of the companies that were awarded projects during the auctions are from Europe and North America and are also looking for this kind of partner. The second type of partner we are looking for is one that can conduct O&M activities. In China we already have a great deal of experience in that area and we want to provide it in Mexico, but first we need a local partner that has experience in the country and with which we can partake in operations here. Meanwhile, CGGC can bring financial muscle to the table to support the activities of its partners.
Q: What other expectations does CGGC have for its activities in the country?

A: CGGC has experience in water and waste treatment, from recycling to the creation of energy from waste. Cement is another area of interest for us because we manufacture equipment for the production of this material. Our involvement in the cement industry started because of all the cement needed for our infrastructure projects. We have facilities that produce this material inside and outside China. I can see CGGC introducing its water and waste treatment solutions in Mexico in the next five years, together with the possibility of fabricating cement. At the moment, renewable energies are the entry point for us, and our leverage to expand activities later on.