Distributed Generation Veterans Aim for ConsolidationBy Cas Biekmann | Wed, 08/12/2020 - 15:02
Q: How did Marsam Solar perform from 2019 to 2020?
JM: It has been a challenging period for us, even though we closed the most important sale in our history. For now, we are focusing on our project pipeline and are looking forward to seeing the pandemic ease away. We thought the pandemic’s effects would have been worse, but were able to weather the social isolation phase quite well, with only some minor adjustments in the company. Now, business is looking up again. Therefore, I think that this year will be at least as good as last year in terms of sales as residential sales are once again picking up.
MM: Last year was marked by uncertainty as Mexico welcomed the new government. This was reflected above all through decreased sales in the residential market, especially apparent in the first nine months of 2019. In the distributed generation niche of solar, work has been put on hold somewhat. But as we had some larger C&I projects, it has allowed us to stay afloat. One example is our first project with Scania, a leading company in transport solutions. The photovoltaic system supplies 282,489kWh, therefore avoiding 129 tons of CO2 emissions on an annual basis. We are also developing our largest distributed generation installation yet. This installation is destined for a textile manufacturer in Veracruz and includes a 409kWp system.
Q: How is the company working to guarantee optimal quality for clients in terms of components and installation?
MM: We are continuously improving our processes and are very self-critical. We demand the highest standard of ourselves. Even if something does go wrong, we always go the extra mile to deliver the result we promised or even surpass it. Having over 900 projects in our portfolio also provides our clients with peace of mind.
JM: In the past three years, Marsam has been working to become more of an institution within the distributed generation market. We are a small company, so continuous improvement via technical training and redesigning our processes are of the essence. When it comes to the quality clients demand, we have a competitive advantage. The Electric Energy Savings Trust (FIDE) re-opened and we had to register there once again, and it became more and more demanding over time. With the right preparation, these demands and those of CFE or CRE can be turned into our own competitive advantage. We always work to be one step ahead of these obligations.
MM: Monitoring of energy consumption is another benefit we have been providing since the very beginning. We do not want our product to be a black box. The results are clear in how much energy the client is saving. We are also starting to see an uptake in interest to use these monitoring systems for O&M.
Q: What drives Marsam’s decision when selecting solar panels and other equipment it installs?
MM: We always aim for high quality components, usually Tier 1 solar panels, because the investment in solar panels is long term. However, as prices have lowered over time, the difference in price between Tier 1 and 2 panels is not that big. Therefore, we favor panels with more power, because we can build better systems on a smaller space. Within the first tier, we work with what is available in volume from wholesalers. If we have a larger project, we have more space to negotiate.
If it is a direct purchase, we can take care of importation ourselves. The goal, however, is to be lean in terms of inventory. We benefit from the fact that supply chains in Mexico have improved significantly over time, meaning we have to import very little outside of our monitors. One area in which Marsam is particularly diligent is compliance with regulatory norms. We do not cut corners in terms of connections and installations. Our main product for mounting systems is Everest. We tailor them to the client’s architecture. Everest turned out to be the most adaptable to Mexico’s conditions. We sometimes see mounting systems made of cheap aluminum, which means there is no certainty of how long the system will last. However, Marsam takes as much care with the installation process as it does with the components themselves.
Companies often focus their attention on CAPEX, which should not be the main focus. They should focus on how much energy it will generate, and how long the system will last. In some cases, spending an extra 10 percent can deliver a faster ROI. The boon from the investment is often not well-understood. Clients should look for quality instead of sacrificing quality for savings.
Q: What are the company’s objectives for the 2020-21 period?
JM: For us, it is important to remain optimistic while keeping our feet planted on the ground. 2020 is truthfully a year to focus on survival. 2019 was also a challenging year for us, but now we are better prepared. We made a big effort to lower our operational costs to the minimum, without sacrificing staff. This has allowed us a certain stability. I think we can finish 2020 with a decent equilibrium in terms of profits and operating costs. Anything better than that would be a welcome benefit. Marsam has operated for about eight years. In other markets, that would be a short time, but it makes us veterans because you can count the solar market in dog years. Moving forward, we are focusing on the C&I sector, which we hope will provide significant growth of around 50 percent toward 2021.
MM: There is still a great deal of uncertainty because we do not fully know how the current situation will impact us. Nonetheless, Marsam will achieve somewhat positive results at least. We will continue to improve our processes, which will provide an important leap forward in terms of future growth. We also think some companies will not make it through the crisis, which would give us an advantage in terms of positioning.
Marsam Solar is a Mexican company with over seven years of experience in the development of distributed generation projects. Following exponential growth, it has more than 2MW of installed capacity in the country.