Enrique González Haas
President and CEO
Schneider Electric
View from the Top

Energy Efficiency at Every Step of the Value Chain

Wed, 02/19/2014 - 15:24

Q: What is the importance of the Mexican market for Schneider Electric’s global operations?

A: Mexico is a very critical country for Schneider. It is very well positioned geographically and is among the largest economies in the world. Schneider Electric has invested heavily in Mexico over the last 15 years, and we now have more than 8,000 employees in 12 locations throughout the country. Last year, we opened a design center here, one of five that we have in the world. We have 240 engineers working in our design centers and our objective is to increase that to more than 300 in the next few years. We have very ambitious growth goals in Mexico. In order to achieve these, we are focusing on satisfying our power customers with the best technology and human talent, as well as on solving the energy solutions required by the energy market.

Q: How would you compare the competitiveness of the Mexican electricity sector to other emerging markets?

A: Mexico has advantages and disadvantages. In electricity, the advantage is that there is only one utility, CFE, operating across the country. This means that companies do not have to deal with several different companies, which would lead to a lack of coordination. However, we need to improve the coordination between demand and production so that we are producing the same amount as is being demanded. But the challenges we face are not exclusive to Mexico. Q: Which role do research and development play in Schneider Electric’s competitive positioning? A: Schneider Electric invests 5% of its revenue in research and development. Each year we dedicate that money to developing new markets, new activities, new products, new solutions, and new technologies, or even to acquiring other companies that will help us to continue consolidating ourselves as a global leader in energy management.

Q: How does Schneider Electric contribute to creating better connections between power generators and consumers?

A: Schneider Electric’s smart grid technology connects the energy consumer with the energy generator. Electricity cannot currently be stored as such, but we introduced the smart grid to avoid electricity being wasted. It is very important to close the gap between what is being demanded and what is being generated. Distribution is extremely important, and connecting the two sides – the consumer and the producer – is crucial. Mexico has a very up to date transmission network. In Mexico, you can have your industrial facilities in the north of the country and a wind farm in the south. But through the CFE transmission network you can connect the wind farm to your energy consumption center in the north of the country. Many companies are interested in establishing a good system to manage the energy they are generating and consuming, and to maximize the benefits of using renewable energies.

Q: What are the main technological challenges in integrating the value chain through a mixture of smart generation, flexible distribution and active energy efficiency?

A: It is a challenge because awareness needs to be created among energy consumers regarding the best ways of using electricity efficiently. For example, saving 1kW on the consumption side can save 3kW on the generation side. Tremendous savings can be made, and if you work on reducing consumption on the demand side you will obtain significant benefits on the generation side. The question that follows is how people can save 1kW on the demand side. There are obvious changes that can be made without affecting employees’ comfort, such as changing light bulbs or using better air conditioning equipment. Areas where energy can be saved need to identified at the start of the development of new projects. There are measures that can be taken that relate to human capital, such as ensuring that working hours are between 7am to 7pm when there is natural light, installing lights that are only on when necessary, or turning air conditioning off after working hours. These measures stop energy from being wasted. Automatic systems can also be created that identify how many people are present and adjust the lighting, air conditioners or heating accordingly. Computers and servers in particular use a lot of energy and produce a lot of heat. We need to combine different technologies and systems so that data centers are managed with the proper information, and help us to adjust and control energy consumption accordingly. We also do not need entire cities that are lit up all night. Such improvements have to be coordinated between the public and private sectors to combat global warming.