Heat: The Overlooked Half of the Energy Transition

When the energy transition is discussed, the conversation almost always centers on electricity. Global data tell a different story. Heat accounts for roughly 48% of final energy consumption worldwide, while electricity represents only 23% and direct fossil fuels 29% (REN21 and IRENA).

Of that 48% of heat demand, more than half is used by industry (53%), followed by buildings (44%) and agriculture (3%). Only about 10% of this heat currently comes from renewable sources. This figure highlights both a major opportunity and a structural challenge: Without a clear strategy to decarbonize heat, net-zero targets will remain out of reach.

The issue is not purely technical — it is one of approach. Simply replacing gas or diesel with electricity (electric heaters or heat pumps at 100%) can be expensive, place heavy demand on the grid, and is not always the most efficient solution. A smarter path exists.

First Reduce, Then Electrify

The most cost-effective and technically sound strategy for eliminating fossil fuels in industrial and commercial thermal processes follows two clear stages:

1. Reduce thermal demand first through energy efficiency measures and, ideally, solar thermal systems that can cover around 80% of heat needs.  

2. Electrify only the remaining demand (approximately 20%) with conventional electric equipment — resistance heaters or heat pumps.

This sequence is deliberate. It reflects a fundamental difference in spatial and energy efficiency. With just 5m² of solar thermal collectors it is possible to generate 3.5kW of thermal power. Producing the same amount of power as electricity requires roughly 20m² of photovoltaic panels. When the end use is heat, solar thermal makes better use of the solar resource and available space — and is often more economical for direct heat generation.

The result is a hybrid solar-thermal + electric system that completely eliminates gas consumption, drives process-related CO₂ emissions to zero, and delivers energy savings of more than 80% compared with a conventional boiler.

How the Hybrid Scheme Works

In a conventional setup, a gas boiler produces steam or hot water continuously, with high fuel costs, specialized maintenance, and significant emissions.

In the hybrid scheme:

• Solar thermal collectors capture radiation and store it in hot-water tanks.  
• Energy is transferred to the process circuit either directly or through a heat exchanger.  
• When solar radiation is insufficient (nights, cloudy days, or demand peaks), electric backup heaters cover the shortfall.  
• The system operates 24/7 with zero fossil fuels.

Field experience shows that the electric backup typically supplies only about 20% of total annual energy. Working in combination with solar thermal, the electric heater consumes up to 80% less electricity than a pure electric system. The outcome is the most economical process heat or hot water available on the market.

Applications Across Industry and Services

This logic applies to a wide range of sectors and processes:

• Food and beverage: pasteurization, boiling, cooking, cleaning, and sterilization  
• Chemicals and pharmaceuticals: reactor heating, drying, and cleaning processes  
• Pulp, paper and cardboard: drying and bleaching  
• Mining: mineral drying and refining  
• Automotive and construction: washing, steaming, and pickling  
• Sanitary hot water for hotels, restaurants, hospitals, sports clubs, and swimming pools  

A real-world example is a system installed at a sports club in Mexico City in 2023. It combines 72kW thermal of flat-plate collectors for sanitary hot water, 620kW thermal of polymeric collectors for pool heating, and a 499kWp photovoltaic system. The result is a true “Triple Play Solar” solution that integrates heat and electricity demands, cutting conventional energy consumption by 85% with renewable sources.

Economic and Fiscal Advantages

Beyond environmental and operational benefits, Mexico’s regulatory and financial framework supports this transition:

• Investments in renewable energy systems can be fully deducted in the first year through accelerated depreciation under the Income Tax Law.  
• Financing schemes with zero or very low upfront investment are available, with terms of 12 to 84 months, fixed rates, and tax-deductible payments.  
• Projects can be structured as leasing, credit, crowdfunding, or power-purchase agreements (PPAs), so that gas savings effectively pay for the investment.

These conditions allow many companies to reach break-even quickly and generate positive cash flow from year one.

Mexico Has the Capacity — and the Opportunity

According to the IEA's "Solar Heat Worldwide," Mexico ranks among the Top 10 countries globally for annual installation of solar collectors. A significant share of this technology is manufactured domestically. The country has abundant solar resources, a local industry, and proven success cases. What is needed now is to scale the right strategy: prioritize solar thermal for heat and electrify only the residual demand.

Conclusion

Decarbonizing thermal processes is not achieved by simply “electrifying everything.” It is achieved through intelligent electrification: first reducing demand with solar thermal energy, then covering only the remaining needs with clean electricity.

This approach enables companies and the country to:

• Eliminate gas and diesel consumption  
• Meet Net Zero targets cost-effectively  
• Significantly cut operating costs  
• Ease pressure on the electricity grid  
• Strengthen industrial competitiveness  

Heat represents half of the energy challenge. Addressing it with the right strategy — solar thermal first, electrification of the remainder second—is one of the smartest decisions businesses and policymakers can make today.