While this administration’s energy policy has brought up discontent among national and international players, the energy industry remains strong. Recovery following the pandemic is still ongoing. While investment outlooks seem to be compromised, states like Puebla want to foster the conditions for recovery in this sector. Engie and Solfium are among the companies that announced investment to strengthen Puebla’s energy market.
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Electricity shortages and energy policies are deterring investors from bringing new capital to Mexico. Experts said that if the outlook does not improve, not only will the country fail to meet its environmental targets, but key sectors such as the automotive industry will suffer the consequences. The private sector has also warned that the country will not meet its 2030 climate goals, including the electrification of 50 percent of the vehicle park.
Engie will extend its distribution network to supply 13 industrial parks in Puebla. The system will supply businesses at Textile City, located in Huejotzingo, Puebla, through a 4.2km long transmission line. The company underlined that over the past 25 years, it has invested in three pipelines representing 1,300km of infrastructure and eight renewable energy power plants in Mexico.
Solfium signed a strategic alliance with the government of Puebla and its energy agency to further develop solar energy in the distributed generation (DG) market. The agreement considers 50MW of solar power for residential, industrial and commercial clients. This will require 92,000 solar panels, providing electricity to 32,000 households and reducing 740,000 tons of CO2, equivalent to planting 2.2 million trees.
In March 2020, the government of the state of Puebla announced the creation of the State Energy Agency (AEEP). Through AEEP, the state government planned to attract private investment to develop renewable energy and natural gas projects. However, Miguel Barbosa, Puebla Governor, recently highlighted that the federal government’s energy policy is making it difficult to concrete private investment projects.
Raquel Buenrostro, Ministry of Economy, extended an invitation to the USTR team to the third round of energy consultations in Mexico City. Buenrostro proposed establishing tri-national (Mexico, US, Canada) working groups that could meet during December and early January to discuss the different aspects of the energy consultations. The progress of the workshops would then be presented at the North American Leaders' Summit, set for Jan. 9 and 10, 2022.
During Puebla Energy Forum 2022, Ricardo Mota Palomino, General Director, National Energy Control Centre (CENACE), stated that by the end of 2024, Mexico’s installed generation capacity will reach 118.55GW, even though demand will be around 50GW.
CEMEX will implement hydrogen injection technology at four cement plants in Mexico to increase its use of alternative fuels. The company announced this as part of its Futuro en Acción (Future in Action) program, in an effort to contribute to the country’s energy transition. The company expects to increase the use of alternative fuels by 8 to 20 percent with this technology.
The country’s lack of gas storage infrastructure puts energy security at risk. This is exacerbated by abrupt supply and demand changes. According to the report "Natural Gas Storage for Energy Security" developed by the Mexican Institute for Competitiveness (IMCO), Mexico’s 2018 Public Policy on Natural Gas Storage set the goal of gradually developing storage infrastructure to reach five days of inventory by 2026.
Absolicon and Grupo Modelo, part of Anheuser-Busch InBev, have signed an agreement for a solar heating installation in Mexico. The full potential for solar heating installations at Grupo Modelo plants in Mexico exceeds 180,000m2. The initial project is expected for 2023 using the patented Absolicon T160 technology. Absolicon solar collectors will run industrial brewing processes providing renewable solar energy through a heat purchase agreement. Absolicon will work closely with local production line partner CITRUS in Mexico regarding the project’s installation and local preparation.
BayWa r.e., a global renewable energy company with presence in 29 countries, celebrated its 10th anniversary in Mexico in 2022. The company has positioned itself as a leading wholesale distributor of photovoltaic solar products, as it accounts for more than 500MW of installed power in different industries, including automotive, food, consumer goods and retail. The company highlighted that solar is the optimal solution for companies looking for clean, affordable and efficient energy.
The Spanish companies Enagás and Alter Enersun announced the joint creation of their new company, Enalter. Enalter’s goal is to develop energy solutions that combine renewable power production and green hydrogen production to decarbonize energy-intensive industries. Both companies, with a marked presence in the Mexican market, will have a 50 percent stake in the new joint venture.