Mexico ranked 33rd on the 60th EY’s Renewable Energy Country Attractiveness Index (RECAI). Mexico scored 54.6 points, dropping one spot since the last RECAI of May 2022, when it was ranked 32nd with 54.8 points. Since 2003, the biannual RECAI ranks the world’s top 40 markets on the attractiveness of their renewable energy investment and deployment opportunities.
The Top 3 comprises the US with 73.3 points, China with 72.2 points and Germany with 71.7 points. The attractiveness score for renewable energy investments was divided into eight categories: onshore wind, offshore wind, photovoltaic solar, concentrated solar power, biomass, geothermal power, hydroelectricity and wave power. EY’s methodology to rate the scores on each category is based on questions regarding the global market trends, as well as the challenges and success factors that impact the company’s clients.
These questions address different topics of interest in the renewable energy sector, such as the need to replace the current power plant portfolio with more renewable energy, or whether public policies hinder or facilitate the ability to exploit renewable power resources. Furthermore, EY questioned the accessibility to long-term contracts, grid infrastructure and availability of finance to ensure the delivery of potential projects. Finally, the company stressed the importance of whether macro stability and investment climate enable or impede the ease of doing business in the country.
Mexico reached its highest scores in the PV solar energy category with 47.2 points, followed by onshore wind with 41.8 and geothermal energy with 39.5. On the downside, Mexico’s less attractive renewable energy technologies for investment were concentrated solar with 24.3 points, offshore wind energy with 21.2 points and wave energy with 18.9 points.
The EY Index highlighted that the global trend in the energy market points toward decentralized distributed energy systems in the form of microgrids, small-scale renewable energy, combined heat and power facilities or distributed energy storage facilities.
"Unlike conventional power generation facilities connected to a centralized grid, with energy often transmitted over long distances, decentralized energy is usually distributed locally... This model offers the potential to increase grid flexibility therefore it will play a key role in boosting global energy resilience," the report reads. According to the index, the drop in technology prices, sustainability goals and the international commitment to energy transition and decarbonization will facilitate this trend.
The report also pointed out that the rise of smart grids and distributed energy networks will increase complex cybersecurity challenges. To strengthen cybersecurity, internal and external collaboration is required. “With the nature of the cybersecurity landscape changing rapidly, threat actors are becoming increasingly sophisticated, so cooperation between and within markets could also play a crucial role in establishing more effective protection strategies,” EY reported.