Enrique González
President & CEO
Schneider Electric Mexico and Central America
View from the Top

Look to Tech to Provide Power Efficiency

Wed, 02/22/2017 - 15:40

Q: How do business opportunities in emerging economies compare with those in developed countries?

A: Even though the way countries embrace technology is different there is no single country in the world that does not need to be efficient in energy management. Some countries prioritize manufacturing while others focus on services, so it depends on the specialization. For Schneider Electric, 43 percent of revenues for the full year 2015 came from new economies. The possibility of working in different countries allows us to be responsible and autonomous as well as to seize all growth opportunities. North America is the second largest region in the world for Schneider Electric. Mexico is in the top 10 for the region and after 70 years in the this market the best way to keep growing is to invest in the expansion of existing facilities, as well as new ones. In some cases the goal is to improve and facilitate a tailored supply chain and make more space available for engineering on demand. Today, Schneider Electric’s operations in the country export about 80 percent of its production to Canada and the US, while 20 percent stays in the local market.

Q: What technological trends are shaping the future of the energy industry and why?

A: Energy demand will almost double in the next 40 years, stemming from the twin challenges of access to energy and the megatrends of urbanization, digitization and industrialization. At the same time, we have to reduce CO2 emissions by half to avoid irreversible damage to our planet. The only way to do that is to become three times more efficient. From that point of view we see a future that will be very different from today. This future will be more electrical, more digitalized, more decarbonized and more decentralized. No single entity in Mexico can cure the country of its ills. We need to co-create our future. That requires that the government, citizens and corporations work together so we can receive the benefits of technological transformation. The potential for efficiency in our world today is absolutely immense. Buildings offer up to 82 percent unrealized potential for efficiency, infrastructure offers 79 percent and industry has another 58 percent to offer. So there are big, achievable opportunities there. When people talk about efficiency in our energy world today, 80 percent of the time they are only talking about the upstream: nuclear vs non-nuclear, shale gas vs non-shale gas, fossil vs renewable. But there is one growing school of thought that transcends the various groups: the belief that the real priority is energy efficiency because the easiest, cheapest, fastest and most profitable way to embrace green energy is to consume it in a smarter way.

Q: What added value do technologies like Advanced Metering Infrastructure devices bring to the grid?

A: One of the biggest problems facing us today is a disconnected grid. As a result, less than 50 percent of the power generation capacity of the world’s utilities is used and about a quarter of the time, less than 50 percent of the transmission and distribution capacity is used. We need a digitally connected energy grid, from generation to transmission to distribution to consumption, driving increased efficiency. We believe that digitalization can make our lives and value chains simpler. There has been a sharp uptake in the adoption of smart power meters around the world. Applications like Advanced Distribution Management Systems (ADMS) and Demand Response are digitalizing grids all over the world.

Q: What are the major business opportunities Schneider Electric sees in Mexico?

A: The oil market is a little slower because of fuel prices but there are still interesting things to do, such as providing innovation and modernization of facilities. On the other hand, we have also identified the following strategic segments in which we are focused: commercial and critical buildings, residential, industry and infrastructure and data centers. Buildings, IT, industry and infrastructure represent 70 percent of the world’s energy consumption. Almost all our innovation is focused on bringing new business and operational value to these markets.