Mexico’s Industry Warming up to Thermal Energy

Q: How has Savesolar developed its business since last year?

A: Between 2019 and 2020, we worked more on industrial projects, gaining more experience in this area, especially after having accumulated a great deal of experience in the residential and commercial areas. Approximately 70 percent of our business development took place in the industrial sector as companies started to look more closely at their operational and energy costs and began searching for a cost-effective and climate-neutral solution. 

Industrial clients are more concerned about design, installed brands and the effect on their structure compared with residential clients, who tend to look more at the costs. We oversaw some projects with very competitive prices nonetheless, with costs per watt installed valued at US$0.72. We also sold a project, valued at US$2.10 per watt installed. Our services combine savings in energy use, design, life-long quality, reliable policies and logistics. For instance, we had the opportunity to develop a semi-circular 0.5MW project in a carport, where we matched our design with performance. Maintenance and security were very important for the 640 solar panels installed, so we designed walkways and life lines.

In 2020, the pandemic forced us to pause the development of projects. More than social distancing and isolation, what affected us the most was the exchange rate, which had a negative effect because our projects are sold in US dollars. Our projects have picked up once again, especially in the residential and commercial areas, because the industrial sector is focusing on implementing other changes.

Q: How would you assess the level of thermal energy-adoption in Mexico’s industrial sector and how are you promoting it?

A: We are involved in the “Solar Heat Initiative” spearheaded by the German Society for International Cooperation (GIZ). Regarding our own work, we have installed thermal energy projects in the industrial sector. One notable example would be the system for multinational S.C. Johnson. That company has since experienced improved energy savings and a faster ROI than if they had adopted a solar solution. It is a technology that many people tend to dismiss because there is no organization in Mexico that regulates thermal energy. Solar energy gets much more of attention from CRE, SENER, CENACE and CFE, for instance. Nonetheless, industries like textiles, chemicals and pharmaceuticals stand to benefit.

Regarding home use, adoption is not widespread for similar reasons. This area in general is not very well-studied or regulated, causing issues related to faulty installations. Our expertise is to manufacture the system, leaving the installation to third parties. Supporting infrastructure such as tubing can be very old in Mexican households, complicating the installation. Therefore, selling our residential through distributors that work with trusted installers or even homeowners has been beneficial. However, if people want to install both thermal energy and our solar solution, we can make an exception.

Q: How does Savesolar assess the latest regulatory changes, favoring state utilities over renewable energy?
A: The change in government and its outlook has been complicated. Everyone had different expectations. The reality is that it seems the government does not favor renewable energy. The policy might well go hand in hand with renewable project development but the government is not developing the industry or supporting its efforts. It seems that international agreements, in which Mexico has committed to having certain percentages of renewables in its energy mix by 2024, have been forgotten. What the impact of these actions will be remains unknown. We see some hurdles creeping up that were not there before. The energy sector might be small, but it stands united and we are looking for new solutions. Examples would be hybrid projects that are small enough to not need any governmental permission, or the incorporation of efficient storage systems to tackle intermittency issues. The sector wants to cater to clients by providing additional technologies. Mexico is developing its renewables sector despite the government’s decision to favor state utilities.

Q: How is the company adding autonomous solar solutions to its business?

A: We have offered autonomous systems from the start. We have a strong and varied expertise in this regard, having worked on marine platforms, telecommunication antennas and smaller systems for municipalities looking to provide basic services. Some of our competitors only focus on systems that can be connected to the grid. Therefore, focusing on autonomous systems provides advantages for us. By searching for quality providers to back up our solutions, we have opened up our route into more solar-based sectors. These alliances have also helped us in times of crisis, where new opportunities need to be identified. We think that these developments will continue no matter what the government does, and that the market will grow.

Q: What goals would you like to achieve?

A: Our main objective is to continue growing our industry and to provide solar solutions. We see enormous potential in this market. We also will continue to work hand in hand with GIZ to promote solar thermal energy. Another goal is to expand our business in Latin America because we see a great deal of potential there. Mexico is one of the more developed countries in the sector, but we have identified great potential in Chile and Brazil as well. There are also markets in Colombia, Peru and Ecuador that are still very young.  Our experience in Mexico can be applied there as well. Last year was an important year because we worked alongside GIZ to bring a project to Cuba, which has potential despite some regulatory restrictions. It was quite a successful project, donated by GIZ and developed by Savesolar. In Mexico, Savesolar’s goal is to solidify its position as a stable and experienced company at the forefront of excellence in the sector.

Savesolar is a Mexican company that offers energy-saving systems that decrease electric and natural gas consumption. Among its services, it offers PV systems, solar heaters and LED lighting to the residential and industrial segments.