Concerns Emerge over New FrameworkWed, 02/22/2017 - 16:56
Q: How does CISA Energía see the energy market maturing in Mexico?
A: There is a lot of uncertainty here. The private sector will have a more active role in the energy generation system due to the newly implemented auction process. However, energy generation projects have to adhere to the prices agreed in those long-term auctions, which might affect project development under other schemes. But we have identified advantages in the sector as we create synergies with other project developers that are interested in improving the country’s energy infrastructure. We are also witnessing an increase in expertise and qualified services in the Mexican energy sector, which will help developers improve the quality of their projects and to optimize their time frames.
Q: How advanced is the company’s initiative to supply renewable energy to private consumers?
A: We have seen a growing interest from different sectors in investing in renewable energy in the past few months but we have also identified several concerns regarding the new regulatory framework. Our customers are particularly skeptical about the functioning of long-term PPAs, especially after the announcements of the natural gas infrastructure plan and the fixed price per megawatthour. In this landscape, renewable energy investors believe that it is a challenging market. Green investors are still interested in promoting these technologies but they are concerned about future prices.
Q: What are your perspectives on project development in Baja California?
A: We are already developing a new wind farm in Baja California and we keep looking for strategic partners to expand our business in the region. We are also taking into account the current plans to connect Baja California to the national grid, particularly as there is great need for developing energy infrastructure in the region. If the peninsula network gets connected to the national grid, we could offer energy supply to a wider number of customers, which would make projects more attractive to us. As a construction company we have collaborated with other wind project developers to offer electrical infrastructure engineering and construction. The most recent contract consisted of installing 47 wind turbines in La Rumorosa, the first wind power project installed on Mexico’s border that exports energy to the US.
We are also developing commercial solar projects in Baja California. Unfortunately, CFE is entering this same market with an unfair advantage because it has a national database of all electricity consumers. The state-owned company also enjoys a subsidized installed infrastructure and the fact that all participants in this market will depend on its net-metering system.
Q: What innovative technologies has the company adopted recently?
A: We designed a technology for hot weather locations, which is similar to what is used in Europe for indoor heating in cold weather regions. The process consists of perforating the soil to install an underground pipeline system and a radiator in the space that needs to be heated. To warm the room, water is used as a heat transfer fluid that absorbs the underground heat and transfers it to the room’s air. Using this same principle, we designed a system that absorbs the air’s heat to release it underground, making it suitable for hot weather locations. The end user can save significant amounts of energy on air conditioning and refrigeration using this technology. In Mexicali, we ran a test using our system and achieved energy savings of 39 percent in comparison to a house with simple air conditioning. We are trying to promote this technology but the cost of perforating the soil remains a challenge, particularly in places with bedrock foundations. Therefore, this technology is only cost-effective now in places with high-energy costs and soil that is easily perforated. We are researching an efficient and low-cost way to perforate the soil but we have not yet succeeded.