US Energy Secretary Jennifer Granholm shared research regarding Mexico’s potential to become a clean energy powerhouse. “Mexico could be a major exporter of clean energy to its neighbors given its world-class renewable energy resource potential, making North America a clean energy powerhouse,” Granholm tweeted.
According to the US National Renewable Energy Laboratory (NREL) Mexico Clean Energy Report, growth in renewable energy could foster more investment, enhance energy accessibility and improve Mexico’s power system. Mexico’s energy transition law establishes at least 35 percent of its energy must come from clean energy as the target for 2024. While 26.7 percent of the country’s energy comes from renewable sources, electricity demand is expected to increase by 12.7 percent by 2024. NREL’s report also discusses Mexico’s renewable energy potential. “National technical potential includes 24,918GW of solar photovoltaics, 3,669GW of wind, 2.5GW of conventional geothermal, and 1.2GW of additional capacity from existing hydropower facilities,” states the report.
The most ambitious scenario in NREL’s study was one of accelerated renewable energy growth, in which Mexico would achieve its goal of supplying 35 percent of its energy production with clean energy. If this were to become a reality, NREL suggested that Mexico could attract US$17 billion of direct investment.
Among the benefits of higher integration of renewable energy, the study reported lower industrial production costs, a decrease in natural gas-fired electricity generation, lower regional marginal electricity generation prices, less fuel consumption, smaller increases in emissions between 2021 and 2024 and a positive impact in transmission congestion, with the most congested interconnections generally seeing less congestion with more renewables.
The report also makes a series of recommendations to further develop clean energy. NREL identifies solar and wind energy as the keys to success for further development. Mexico must therefore develop programs to attract large solar development, enable institutional finance mechanisms for development, avoid delays due to permitting and provide assistance in community consultations, encourage technical knowledge sharing as well as spur development and supply chain investments that benefit the domestic economy.