Extra Safety for Project Conclusion

Q: What factors prompted X-ELIO to enter the Mexican energy market?

A: The company was founded in 2005 and enjoyed solid growth in Europe during 2008 and 2009. Given our international vocation, the decision to go to Latin America, specifically into the Mexican market, was logical. Mexico, on a global basis, is one of our sweet spots. The company’s main activities are quite focused here and we expect to grow year by year. This goes hand in hand with the opening of the market and the country’s political stability. Also, its regulatory framework has been shaped to achieve the longterm success of the industry.

Q: What added value does X-ELIO offer to its customers?

A: X-ELIO has the intention to own, on a long-term basis, all solar projects in which it gets involved. The company is simultaneously involved throughout the industry value chain as generator, developer, constructor and operator. We have a very experienced team in all the main areas of the energy business, from engineering to structured financing, considering also construction, operation, maintenance, development and due diligence. This gives us independence and the ability to make quick and practical decisions.

Having global operations and broad experience makes us an attractive sponsor for both project development and energy commercialization. Add in the company’s financial strength and we are a perfect option for the market. We were founded with the purpose of being a long-term player. Our business model does not consider a project portfolio that has to be continuously rotated. We do not just hand over the keys of the project but take care of it across the entire value chain.

Q: How would you categorize the success of the long-term electricity auctions?

A: X-ELIO has taken part in the process since its outset. In the second auction, we won three projects with a total of 244MW peak. The first project is in Chihuahua, the second in Morelos and the third in San Miguel de Allende. X-ELIO will continue to participate in the next auctions with renewed interest. Our projects are highly attractive because we only bid projects that have reached a certain maturity level of development, lowering their associated risk.

Due to their complexity, the long-term electricity auctions have entailed a hard learning curve but the changes have certainly been for the better. Some of the most important aspects where we have seen improvement is in the fluidity of communication with CENACE, the support desk that was launched, and now a much clearer regulatory framework. Regarding the launching of the Clearing House, we have yet to see how this will affect the development of the contracts. Hopefully it will be positive, making the warranties clearer and more robust for other participants besides CFE.

Q: Has X-ELIO encountered any particular challenges during the development of its projects?

A: We have not found any challenge or situation that was especially unfavorable, which goes hand in hand with our strategy of not closing any contract unless we have thoroughly analyzed the implications of the project, mapping any potential environmental, cultural or social risk. We have the experience and know-how to recognize the risks that could bring down a project.

Q: Into which areas would X-ELIO like to expand in the Mexican market?

A: X-ELIO wants to continue growing. At the moment our core business and expertise is focused on the development, financing, construction and operation aspects of renewable energy power plants. That is where we will stay for a while, getting stronger and bigger. We would like to become one of the most important players in Mexico for these particular subsectors. We also want to take part in future auctions. Looking further ahead, we want to start working on bilateral contracts and enter the energy-supply business