Renewable Sources Taking Center Stage in Energy MixMon, 02/25/2019 - 16:33
Q: In your view, what will be Zuma Energía’s most important contribution to Mexico’s energy transition?
A: In 2018, Zuma was dedicated to building the largest wind project in Mexico and two large-scale solar projects simultaneously. These projects were winners of the 2016 auction and achieved financial close in 2017. The Reynosa wind farm is the largest in Mexico with a total capacity of 424MW and will mitigate 739,000t/y of CO2. The solar projects, Orejana and Santa María, built in Sonora and Chihuahua, have over 1 million solar panels and will supply over 500,000 homes with clean energy, mitigating over 280,000t/y of CO2 emissions. Zuma is making a significant contribution to a sustainable and competitive energy system and, as a result, contributing to the mitigation of energy poverty. In 2019, Zuma Energía will operate a portfolio of 818MW of renewable energy assets that will contribute to Mexico’s energy transition.
Q: What is wind power’s role in Mexico’s energy mix?
A: According to the Ministry of Energy, 59 percent of the increase in installed capacity of clean technologies between 2016 and 2017 was due to the installation of new wind power plants, equating to 464MW. In 2017, 15.3 percent of clean power was generated by 45 wind farms in Mexico, which contributed to 3 percent of the total national electricity generation. As results from the three long-term electricity auctions continue to materialize, the role of wind power generation will increase significantly. The installed capacity of renewable energy is estimated to grow 235 percent compared with the existing capacity before the auctions, incorporating 7,000MW of clean energy to the system. Wind technology has had a significant deployment because of technological advancements and important cost reductions, which makes it attractive for investment. Also, Mexico has an estimated untapped wind potential of 15,000MW, particularly in the states of Oaxaca and Tamaulipas. If public policies and regulation continue to be strengthened in Mexico, there is no question that renewable generation, mainly solar and wind, will continue to thrive.
Q: What is needed to create a local value chain that supports the development of the awarded auction projects?
A: With the growth of the renewables sector in Mexico, local value chains have started to develop naturally. We will receive blades manufactured in Mexico for our projects. Although renewable energy ventures have positive economic effects in several localities, the social and economic impact has been enhanced by the implementation of a long-term strategy to maximize the potential of local participation, to adapt local supply chains of products and services needed by the industry. The first pillar is the visibility of long-term demand for such products, by providing stability to the regulatory environment. In order to contribute to the implementation, we should identify and analyze the current gaps between the demand and supply of products and services, and then collaborate in a public-private strategy to develop the local capabilities to meet the needs of the clean energy sector. The talent and work are already available in many of the states across the country and those can be bolstered by training and capacity building. Zuma Energía has worked with local companies in the three sites (Tamaulipas, Sonora and Chihuahua) where our recent projects were built. Zuma contracted local consultants, technicians and engineers, legal, environmental and administrative advisers and had an impact on local economies through the consumption of products and services.
Q: What should the new administration prioritize to develop and secure the future of Mexico’s renewable energy projects?
A: We hope the administration fully embraces the benefits that renewable energy represents for the country and implements public policies that maximize the adoption of renewables. Renewable energy has proven to be the most affordable source of energy to meet increasing demand. It can also strengthen Mexico’s energy sovereignty by boosting national electricity production and reducing gas imports.