LatAm Transition Fueled by Storage, Mobility, Infrastructure

Q: Since we last spoke in 2024, how has AINDA evolved in terms of fund size, geographic scope, team composition, and investment activity?

A: Since 2024, we have doubled in size. Before, we had one fund, a CKD, of around US$330 million, depending on the exchange rate. Between 2024 and 2025, we raised a second trust, because the first one is already fully invested in nine projects. Now we have a private trust of a similar size, and we are likely to add another US$100 million to it. So we went from having one trust with US$330 million to having two trusts with US$660 million, and we will likely reach US$750 million.

Also, during this period, several people joined us. For example, we brought on Juan Carlos Echeverry and Ángela María Orozco as partners for the office we are opening in Colombia. Initially, our vision was limited to Mexico, since the CKDs were restricted to Mexico, but the second trust is being raised with a parallel vehicle in Colombia.

In Colombia, we are still in the stage of engaging institutional investors, aiming to raise about US$100 million. That office will be led by Juan Carlos and Ángela María. Juan Carlos served as Finance Minister and CEO of Ecopetrol, and Ángela María was the equivalent of the Minister of Communications and Transport, as well as Minister of Economy, twice.

So in terms of projects, with the second fund, we have already made a first investment in solar parks we acquired from TSK in the state of Durango totalling around 200MW. With that, our platform now totals around 450MW, considering the 230MW from the first trust.

Q: How do you assess the real impact of recent reforms on private investment, and what challenges or opportunities do they create for companies looking to partner with PEMEX or CFE?

A: I would separate the two. In terms of electricity, the reality is that this was a good reform. If you remember, they did not change the dispatch order, as it is still based on economic merit. What they really did was introduce two new types of investment. Private investment is still allowed, and now they have added support for CFE through mixed enterprises, which come in two forms.

People think that the recent changes were a step backward, but in reality, the core of the electricity reform was just adding two new partnership models with CFE. Essentially, it is IPPs, which have been around since the 1990s, version 2.0. That’s really the heart of the electricity reform.

Regarding the oil reform, I would say there is room for improvement, because it is based on the assumption that PEMEX can be a good financial partner. The problem, however, is that PEMEX is a bankrupt partner. These mixed enterprise contracts give PEMEX a percentage of the profits just by name alone, not even based on the contract terms. They do not account for the complexity of certain projects, like deepwater developments or fields in their final stages, such as tertiary recovery.

Fixed profit percentages do not reflect the different returns you get depending on a project’s life cycle. That is going to make it harder for investors to come in. Also, PEMEX would still be the operator. If that is the case, and you cannot book the reserves, no major international operator, , will come under that scheme. They would only come under license contracts or production-sharing agreements like we had in previous administrations, and which legally still exist.

Since no new bids have been issued, we are seeing a push for partnerships between PEMEX and small or mid-sized Mexican or foreign companies, the kind that do not have the technological capabilities we need for today’s challenges. The big question is how to ring-fence the resources. Because today, if PEMEX is the operator, the money goes into its accounts. If the funds are not segregated, the money will never make it to your pocket on time.

You cannot ask an oil company to also act like a bank; that is not its role. That is the real, core challenge. It is based on a diagnosis that does not recognize the severity of PEMEX’s current operational and production issues. There has been a migration of talent, of engineering expertise, needed to develop these projects, while financial health is poor. Moreover, challenges lie in areas for which the company was never prepared but where the resources are: enhanced recovery, deepwater, shale.

I think we are entering a difficult phase. Maybe in three years, there will be a moment of reflection and we will realize that this was not the path the country needed to take.
 

Q: AINDA recently expanded its geographic scope beyond Mexico. What motivated this decision, and how do you evaluate infrastructure investment opportunities in other Latin American countries like Colombia?

A: In the first trust we analyzed 95 or 96 projects, and out of those, we ended up investing in five. We put everything through a very strict filter. What we told our investors was: “We are not going to stop looking at Mexico to focus abroad.”  This expands the project pipeline we can access. Colombia, mainly, but also Peru and Panama, have major infrastructure opportunities. They face significant energy and infrastructure deficits, and they are experiencing population growth, rising quality of life, and improving economic well-being, which makes a lot of sense.

Twenty or thirty years ago, Mexico’s export industry was located at the northern border; it was the closest option, as there was no logistics or electrical infrastructure. As infrastructure developed, the export industry moved into the Bajío and toward the center of the country. Now, the northern border has mostly remained as a maquila zone.

In Colombia, it is very similar. Ground transportation is extremely complicated; most things have to be flown due to the challenging terrain. Today, there are only two or three major roadways running north to south, and barely any east to west. What is truly needed is a proper grid that allows exports. It should not take more time to send a trailer with goods from Bogotá to a port, than from that port to Mexico. That is just ridiculous. So you start to see the opportunity to develop infrastructure that enables a sort of nearshoring, where Colombia becomes a supplier for the Mexican market.

Q: Nearshoring is driving a surge in industrial and energy infrastructure demand in Mexico. How is AINDA identifying and addressing key needs for the energy infrastructure sector?

A: Industrial parks are currently at 100% occupancy. You almost never reach full capacity at an industrial park. Typically, once occupancy hits the 90% mark, you start building a second or third park. However, we are at 100% because there is no electricity available. We have dozens of finished industrial parks that are not connected. Companies are eager to say, “Look, I want to move in and start operations today,” but they simply cannot.

The other major issue is water. Whether we like it or not, the competition for water between industry and the population is only going to increase. And, unfortunately, the regions driving nearshoring activity are precisely the ones experiencing the greatest water stress. What the country needs is a paradigm shift to provide water to the industry that does not compete with water for human consumption. That can be achieved through purple pipelines: taking municipal wastewater, treating it, and selling it to industry, not for consumption, but for use in processes. This would help the country because today, water treatment plants are outdated, degraded, and not operating. As a result, we have severe pollution issues.

This would take us from a vicious cycle to a virtuous one, treating the water, preventing discharge into ravines, and selling the treated water to industry, which is eager for water. For example, the electricity sector needs water to cool boilers. If there is no water, it does not matter how many power plants you build, you simply cannot operate them. So this becomes a systemic problem.

In terms of opportunities, the strongest corridor is from Queretaro to Nuevo Laredo. We own the Monterrey–Nuevo Laredo highway, and four out of every 10 export dollars to the United States pass through there.  Another important emerging corridor is Manzanillo as it has the country’s most important port. A lot of what’s changing is that we will begin importing components or parts. So we need to expand Manzanillo’s internal infrastructure capacity, particularly the highway that already exists, by increasing its capacity.

Q: How is AINDA addressing the challenges of integrating battery storage with renewable energy projects, especially given recent policies requiring energy storage in new wind and solar developments? 

A: There are two challenges with renewables The first is that you produce electricity when there is no demand. That is, you generate power between 10 a.m. and 6 p.m., while peak demand is from 6 p.m. to midnight. Prices are set every 15 minutes, so you are producing electricity when prices are at their lowest. To stabilize the grid, CENACE will not allow you to produce more electricity than what is demanded at any given minute. If there is oversupply, it causes a blackout, so the system sends warnings telling you to stop producing electricity, which is called curtailment.

When you combine curtailment and low prices during production, the incentive to find a solution to sell during peak price periods becomes very important. I am talking about price changes not just by percentages but by orders of magnitude.

A battery costs nearly 50% as much as a solar park, reaching US$60-70 million. We need to analyze this, especially considering the updates and regulations on power zones. It is clear that batteries are needed, and a significant wave of battery installations is coming.

I would say we are at the forefront of this. We have been working on this for about 12 to 14 months, requesting detailed engineering and profitability analyses and making companies compete. So yes, it is going to happen. 

Q: How does AINDA view the challenges and opportunities in distributed generation and self-supply for industrial and commercial clients in Mexico? 

A: Especially in distributed generation, the main challenge is fragmentation. You need to find a player who has some concentration within that fragmentation, meaning they should not have one client here, another in Puebla, one in Zacatecas, another in Baja California, and one more in Cancun. You need to start concentrating in metro areas, like Mexico City, possibly Guadalajara or Monterrey, and grow concentrically; otherwise, the operation itself will overwhelm you. This hasn’t happened in the country yet. Under fragmentation, how can you serve clients if a problem arises? Companies that have operated this way probably will not survive due to operational processes.

Q: How do you see AINDA’s future growth in the coming years, and what other emerging areas do you believe hold the most potential for investment and development?

A: Something we are seeing with particular interest is mobility and energy transition topics. Regarding mobility, the reality is that much of the traffic happens on interurban highways, and there you have to figure out how to solve the capacity issue of the roads. Today, toll booths create bottlenecks that reduce the flow capacity of vehicles. We need to find ways to make toll booths operate faster, so that you do not have to widen them horizontally but instead multiply the capacity of each booth many times over, while also making car usage more efficient.

It would be ideal to have algorithms to sell passes that allow you to use the road whenever you want, or charge less depending on distance or people traveling. At the end of the day, maintaining a road costs the same whether one car passes or not. At the same time, we need to find a solution that increases capacity because building a third level is not an option. That’s the reality. 

In energy transition, there are many waste-to-energy projects happening profitably, and there are schemes and incentives helping to strengthen these processes as companies are migrating toward them. We are prioritizing this as demand is growing.

In the near future, I see AINDA opening operations in Colombia, raising a third, fourth, fifth fund. We should not forget that whether we like it or not, the Latin American population is growing. We have a demographic bonus and also, pension schemes have been modified. If you add the population pyramid to the fact that the money going into Afores is going to more than double, demand for investment funds for infrastructure and energy projects will grow exponentially. There is a strong opportunity in the sector to keep growing simply due to the law of large numbers.