Long-Term View Above AllWed, 02/21/2018 - 15:38
Q: What key advantage does Ingeteam bring to the table in Mexico?
A: Our biggest strength is in R&D, in which we invest up to 5 percent of our annual budget. From the very beginning, we knew that focusing only on short-term sales for installation, operation and maintenance would hurt us, so we started investing in R&D. Given our deep experience in power electronics, and thanks to the renewables market boom in Spain during the 1990s, the company opened a business area focused on power electronics for the wind sector. We opened our Mexico office in 1998, offering services to the steel industry in the country’s northern region.
It did not take long for energy projects to start booming in Mexico. That was the moment we decided to open a branch of our business unit for renewables that already enjoyed a strong position in the international market. Today, we have around 2.6GW of O&M contracts in Mexico, together with 120MW of inverters connected and 20MW that will be connected by August 2017.
Q: In which areas does Ingeteam foresee the most opportunities in Mexico?
A: We have found our biggest market in PPAs, not because we focus on these kinds of projects but because they were the only possibility before the long-term electricity auctions. The projects assigned through the auctions will take time to materialize but we will push to promote our presence. The auctions have also resulted in low prices that forced companies to rein in budgets. We can offer products and services that are optimized to ensure CAPEX and OPEX savings.
Q: Do you see potential for the inclusion of batteries in Mexico’s transmission and distribution grids?
A: In Mexico the batteries market will develop in regions where they are either a regulatory prerequisite or where there is extreme need. Losing up to 80 percent of energy production at a 30MW solar plant because of a cloud is extremely risky in a system that can only tolerate 10MW variations. That is the case in Baja California where the system’s eight nodes are isolated from the other 45 that are part of the SIN. If batteries are not installed in a small grid like this, then the grid will not be able to handle variations that are inherent to renewable energy production. Therefore, the batteries market has potential in such isolated systems but we do not see much short or middle-term potential in other regions of the country.
Q: How can Mexico deal with the human capital gap it is facing?
A: Although the human talent gap exists, the main challenge that companies will face in the energy sector will not be talent acquisition but talent retention. Companies that hire a worker will offer specialized training and will try to develop that person’s abilities within the company. As the worker advances, that person will become more and more appealing to other companies that are just entering the market and that might be willing to offer bigger economic incentives. Ingeteam not only offers its employees attractive job conditions and incentives; the company’s entire philosophy revolves around human development. It is in our DNA to invest in technology development and to focus on long-term commitments, so it is logical that we translate these efforts to the development of our workforce.
Q: What are Ingeteam’s long-term plans for Mexico?
A: Ingeteam is the No. 1 supplier of power electronics for wind turbines in Mexico, with over 1.8GW of wind turbine converters supplied. We will soon have 140MW of inverters connected to PV projects, which makes us the leader in this market in Mexico. In the future we will continue making strong and prudent offers. Some companies may take the lead due to their bidding strategies but it will only be for a short time. Overly aggressive offers made by new companies will be attractive in the beginning but they will either only allow companies to enter the market with the hope of higher prices in the future or end up causing budget problems for those companies. Over the long term, these companies will disappear while we will remain strong.