Luis Sánchez
Director General
View from the Top

Cracking the Project Development Sector

Wed, 02/21/2018 - 15:36

Q: What are Mexico’s major challenges in developing residential use of solar power?

A: Mexico has three major challenges. First, we have the cultural and behavioral components. We have a responsibility to communicate and create awareness about the benefits of solar power and to debunk misconceptions. Companies involved in solar power like ourselves need to be precise and assertive when raising awareness. We rely heavily on social media and all news broadcasting formats to this end. Second, financial sources. When we started this business, there was a lack of financial structures for renewable energy, yet there was a dire need with almost every project, from the entrepreneurial outset, to finance final clients. Third, the sector needs trained professionals throughout the whole value chain, from installation technicians to project developers and engineers. Proper regulations and certifications need to be in place to further enhance the preparation and training of renewable energy experts. 

Q: Which industries are most eager to transition toward renewable energy?

A: First in line are those whose business lines require intensive energy consumption: concrete, plastic, textile, automotive, and agro-industrial, to name a few. They are choosing renewable energy as an electric power source because it is cost-effective and helps them comply with the compulsory 5 percent requirement in CELs. This will have a positive spillover effect, as major conglomerates such as CEMEX or Volkswagen will need to rely on their suppliers to comply with this new requirement.

Q: What is ErgoSolar’s strategy behind its partnership with Solarnet?

A: ErgoSolar has been operating in the Mexican market for seven years now. We launched the company at the same time as the Interconnection Law came into effect in 2008. Today we have 400 solar power projects successfully installed and operating nationwide — Tijuana, Puebla and Guerrero, among other locations. Our business scope revolves around distributed generation and megaproject engineering. We wanted to start adding value to utility-scale projects, hand in hand with an international EPC company, such as Solarnet, which transitioned organically from construction to renewable energy. This is a major comparative advantage when it comes to addressing utility-scale projects, as well as Solarnet’s financial strength and capability. The objective of our collaboration is to deliver the most competitive EPC option for Mexico’s renewable energy market, combining Mexican and international experience, providing competitive solutions for the market’s off-takers and covering projects ranging from 5MW to close to 200MW.

Q: What is missing to capitalize on the potential of distributed generation in Mexico?

A: Besides the threefold challenges I mentioned earlier, which also apply here, Mexico has to start thinking smart grid. For about 70 years, the private sector was prohibited from participating in any aspect of Mexico’s electric system. As a result of the reform, the great unknown has transformed into the great opportunity, where private players can participate directly in the industry’s entire value chain, from generation to consumption. 

Q: How does ErgoSolar stay up to date with the latest technological developments in solar power?

A: We are strongly focused on investing in technological innovations and the company is opening two new business lines: process innovation and engineering innovation. We make sure to stay in the loop regarding the industry’s latest international developments and we keep a close eye on the products and services our suppliers invest in. As a solar power company, we are addressing the major challenge posed by Potential Induced Degradation (PID). This refers to the degradation of solar module crystals as a result of ion exchange between silicon and aluminum. The industry is proposing aluminum-free solar modules and we are exploring other options as well. We always keep in mind that these new developments must meet Mexico’s specific needs.