Álvaro Velasco
Regional Manager Mexico, Central America and Colombia
Enertis Applus+
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New Business Opportunities Emerge on Back of M&A

By María José Goytia | Tue, 04/26/2022 - 17:07

Q: How has the acquisition of Enertis by Applus+ increased the company's scope regarding its consulting, engineering and quality assurance services?

A: The Applus+ Group acquired Enertis in 2021 and, as a result, Enertis Applus+ has broadened its global reach. The Applus+ Group is one of the world’s leading companies in inspection, testing and certification, with a 2020 turnover of €1.6 billion (US$1.76 billion). Applus+ is present in 70+ countries and provides solutions for customers in all types of industries such as power, construction, telecom, oil & gas and other diversified industries. Enertis Applus+ has a consolidated position in consulting, engineering and quality assurance services in the solar PV and storage sectors. The services offered by both companies are complementary and Applus+' reach gave Enertis a large platform to foster the company's global growth.

 

Q: What does Enertis Applus+ seek to achieve in the Mexican market?

A: Enertis Applus+ has positioned itself as one of the leading companies for consulting, engineering and quality assurance services in the solar PV sector within the Mexican market. The company has been operating in Mexico for 10 years and we are confident about the market’s long-term potential. Building on our continued presence, a professional and committed team and the support of the Applus+ Group, we aim to continue to expand our services in the Mexican solar PV value chain. We also aim to enter the hydrogen sector and complement the Applus+ Group in the wind sector, where they have a consolidated activity.

 

Q: At what stages of the process do companies require assistance from Enertis Applus+' consulting services the most?

A: We work throughout the entire value chain of solar PV projects. Enertis Applus+' portfolio of services is strongly diversified. For example, in the development stage, we support clients in structuring the project, advancing permits, and managing preconstruction processes, such as contractor selection. During the construction stage, we focus on quality assurance and construction supervision. For the operations phase, we provide on-field quality assurance services and solve performance issues. Due to the current state of the Mexican market, we mainly provide services for projects that are in the latest stages of construction or already in operation.

 

Q: How does Enertis Applus+ perceive the uncertainty in the energy sector’s regulatory framework?

A: There has been a significant slowdown in the sector. All the regulatory changes implemented since 2018 have generated a great deal of uncertainty in the Mexican energy market. This sector’s operations depend on certainty, legal security and investor confidence, as power plant construction is CAPEX-intensive. In the short term, we believe this environment of uncertainty will prevail, especially as far as utility-scale projects are concerned. However, we are confident that in the long term, renewable energy generation will consolidate its position in the Mexican market.

 

Q: What is the potential in Mexico to add battery energy storage systems (BESS) to existing solar plants?

A: The potential of storage as a complement to intermittent power production, such as wind and solar, is immense. Implementing storage solutions to these projects makes perfect sense to take full advantage of the energy generated and to contribute to sustainable electrification, a key driver to achieve decarbonisation goals.

As far as large-scale battery storage solutions are concerned, some markets are more mature than others, with the US, UK and Australia having the highest levels of sophistication. At a global level, utility-scale BESSs are still at an early stage of deployment. However, over the past years, they have increasingly improved their efficiency and cost. Therefore, in the next few years, their implementation is expected to be economically viable at any scale.

To promote the technological development of battery storage and make a BESS economically attractive for companies, an adequate remuneration of these systems and a clear regulation are essential. Right now, Mexico offers few opportunities, due to its regulation and compensation levels, but we anticipate opportunities to keep increasing in the medium-term.

 

Q: What are Enertis Applus+' main projects and objectives in Mexico for 2022?

A: In 2022, we look forward to strengthening and growing our services related to operating solar PV power plants and remain available to support clients looking to develop new projects in the medium term. Enertis Applus+ offers some unique tools, such as the first solar PV mobile laboratory in Mexico that enables on-site testing, as well as a few analytical tools based on machine learning and data science techniques implemented in the evaluation of the performance of operational assets. Our references also include several ongoing projects with technical advisory for financial entities and projects in the construction and operational stages for utility scale and distributed generation (DG). Last year, we expanded our collaboration with financial institutions for DG developments. Therefore, we expect to continue consolidating this line of business throughout the year. Regarding collaboration with governmental bodies, we cooperate with public entities in Baja California to supervise the installation of solar PV plants.

 

Enertis Applus+ offers consulting, engineering and quality assurance services to cater to the needs of project developers, IPPs, equity funds and financial institutions. The company acquired the current name upon acquisition by the Applus+ Group in 2021.

Photo by:   Enertis Applus+
María José Goytia María José Goytia Journalist and Industry Analyst