Government to Develop Financing Program for Energy Storage

The government of Mexico requested a loan from the Inter-American Development Bank (IDB) to finance a program to develop energy storage systems. The program will benefit companies willing to invest in distributed generation (DG) solar projects paired with energy storage systems.

Mexico's Development Bank (Bancomext), a Mexican state-owned bank and export credit agency, applied for a US$9 million credit with IDB to finance the development of the Support for Energy Storage System program. “The overall goal of the program is to contribute to the operational efficiency and environmental objectives of small and medium-sized enterprises (SMEs) by promoting the deployment of sustainable investments,” official documents read. 

According to Sergio Rodríguez, Service Manager for Mexico and Latin America, Ginlong Solis, an international manufacturer of solar inverters, DG in Mexico reaches from 500 to 600MW among the residential and commercial sectors. Nonetheless, he pointed out that even though solar technology is growing, the main barrier to boost this market continues to be the high price of batteries for storage systems.

During the Eneryear México 2022 event, Héctor Olea, President, Gauss Energía, stressed the main challenge for the development of new renewable energy technologies is storage to achieve a more robust electrical system. "The name of the game is 'storage'. This is where the main battles will be fought to support big projects. Over the next few months, we will see overly competitive storage solutions linked to wind and solar projects," he said.

The implementation of this kind of program will therefore encourage the adoption of storage systems and contribute to enhancing energy generation through sustainable projects in the country. The specific goal of the program is to be a pioneer in financing flows for SME investments in battery energy storage solutions and energy efficiency projects. The program is set to benefit companies in the industrial and commercial sectors interested in investing in small-scale energy projects and storage systems. Furthermore, it will primarily focus on beneficiaries funded under the Global Credit Program to Support Economic Recovery in Mexico. Every singular project is expected to receive a maximum funding of US$1 million. 

The resources will be used to finance a revolving credit guarantee fund, managed by Bancomext to partially cover loans granted by the bank itself or by an intermediary financial institution to the participant SMEs. Moreover, the resources will be deposited in a trust that administers Bancomext’s various guarantee instruments and will have its separate accounts for the program.