STORY INLINE POST
Q: What is Toshiba de México’s most important contribution to bolstering Mexico’s energy transition?
MF: Continuing to place confidence in Mexico is among Toshiba’s primary strategies, as it has been since 1957. We have worked with CFE for more than 60 years and will continue to do so. Our core business in the country revolves around steam turbines and combined-cycle plants. The country’s PRODESEN 2018-2032 estimates that 35-38 percent of power generation by 2032 will correspond to combined cycle, which makes technical sense given the baseload properties of this technology. PV and wind are spearheading the country’s renewable energy industry but they remain intermittent. Wind power’s average load factor is 40 percent of yearly plant capacity and storage options remain costly. Geothermal is another technology we are seeking to promote. Toshiba is a world leader in the supply of geothermal steam turbines. In Mexico, our Cerro Prieto installed capacity surpasses 400MW. The country has a sizable geothermal resource potential but financing issues dampen its progress. We are looking into other clean electricity generation alternatives, such as PV technology via a joint venture with Mitsubishi.
Q: What hurdles is geothermal energy facing in Mexico?
MF: Mexico’s available nodes, close enough to geothermal fields, are too costly to install power generation plants and generate profitable rates of return. The country’s long-term electricity auctions are largely inclined toward PV and wind technologies, to the detriment of geothermal energy. As it stands, CFE is the only player able to provide competitive geothermal projects with its geothermal portfolio. Added to that, the select few private companies that could afford geothermal concessions are undertaking resource studies and drilling activities, but given the nature of the projects it will take four to five years for them to reach production phase. The window of opportunity is there, and Toshiba will be the first to capitalize once it opens.
Q: How is Toshiba positioning its O&M services for clean energy projects?
MF: Toshiba has a service department in Mexico through which our turbine fleet installed for CFE is overseen, as well as Mitsui’s Valladolid turbine. Through this department, we provide a full range of services, including after-sale, spare parts and valve rehabilitation. In the past, long-term service agreements for natural gas turbines were the norm. Now, the market requires the same type of agreement for steam turbines. We are working together with natural gas turbine manufacturers to achieve joint ventures to provide the client a single point of contract.
Q: What new technological developments are you working on?
MF: Toshiba’s DNA is composed of innovation and development. Our flagship project is a 20MW hydrogen power generation plant pilot development. We are also focusing our research efforts toward battery-powered energy storage solutions. On March 27, 2018, Toshiba was awarded the Guinness World Record in efficiency for its combined-cycle power plant, with a thermal efficiency of 63.08 percent. Toshiba did the EPC works for this plant for Chubu Electric Power, a Japanese utility, including two phases of 1,200MW each with two GE gas turbines and Toshiba steam turbines.
Q: What is Toshiba’s growth vision in Mexico for 2019-20?
AM: A country’s energy demand is directly linked to the performance of its economy. While Mexico’s economy can either shrink or grow on a yearly basis, investment flows for projects working under a long-term scope should be maintained. Combined cycle’s baseload capacity should be fully taken advantage of. But a combined cycle pipeline cannot be set up in a day. It needs to be provided the favorable conditions it requires to grow to its full potential. To achieve this, it is vital to create a long-term vision, with clear objectives toward the future and a solid action plan.