SMS Sees a Bright Future in Solar

Project developers, large EPC companies and private utilities are not the only ones looking to leave their footprint in Mexico’s renewable energy industry. SMEs also want to take advantage of the country’s favorable business environment. To succeed, they would be wise to turn to local associations, says Gustavo Rodríguez, CEO and Founder of Vansertec, a Mexican engineering group working with integrated green energy and energy-efficiency solutions.

“About a year ago, I realized that an important step toward a successful business, from an SME standpoint, lies in connecting with Mexico’s business sectors through local representative chambers,” says Rodríguez. “That is how Vansertec started getting involved with Mexico City’s COPARMEX and why we are also very active with ANES.” 

Vansertec is betting on solar energy for several reasons. “In Hidalgo, we are developing a 1MW project. With solar panels, the cost of this project for a client is close to US$1 million. If we were to use wind turbines, the project would cost twice that amount. Solar parks give you the opportunity to provide electricity in situ, while wind farms necessitate specific locations, with terrain that meets a list of different particularities, requiring additional transmission of the generated electricity to your consumption point, causing energy losses,” Rodríguez explains. 

Although the company would like to foster residential solar power, the users that consume the highest levels of energy are within the commercial and industrial sectors. “It makes sense then that these sectors were addressed first,” Rodríguez says. Compared to high consumption domestic users, under tariff 1 levels, the tariff 2 and 3 levels have dramatically increased to foster a migration toward greener alternatives. “Tariff 1 levels have remained unchanged. For domestic users, we are missing an adequate return on investment in installing solar panels under tariff 1 conditions, especially if electricity consumption is moderate. We could be talking about a 10-year ROI.” With distributed generation and the regulating modifications coming for 2018, Vansertec is hopeful this niche will be opened for companies to exploit the opportunities there. 

Waste-to-energy technologies have also caught the attention of the engineering group. “For that segment of the market, we formed an alliance with American Logic Energy. Vansertec is interested in this practice because it is new in Mexico. But there is still a need to raise awareness and popularize this technology.” Rodríguez says. The only reference, he adds, is what Mexico City Mayor Miguel Ángel Mancera is doing in thermovalorization, in partnership with Veolia, to supply energy to the city’s subway. “While it is an important step forward, the project is rather overpriced by our estimates.” Through this project and the inauguration of Mexico City’s Office for Promoting Investment in Energy Sustainability (OFISECDMX), however, the stage is set for this technology to prosper in Mexico, although it will take time. “As far as we know, Morelos and the State of Mexico are the only local governments interested in having wasteto-energy plants,” Rodríguez says.

Vansertec is also looking to make significant contributions to Mexico’s human capital. “ITESM is dedicating considerable resources to training technical and entrepreneurial talent for this sector,” Rodríguez says. As a service marketer, Vansertec is interested in executive talent being developed at top-tier academic institutions, since it outsources all technical aspects of its business. “Our company always makes a point to outsource to Mexican companies. We are also looking to integrate interns interested in technical careers in renewable energy and who are searching for opportunities to work in SMEs like Vansertec.”

SMEs are also subject to capital availability. In Vansertec’s case, Rodríguez considers its partnership with Iberdrola to have been quite useful in that regard. “We turned to Citibanamex, which has a department exclusively dedicated to green energies. If your project has an estimated value greater than MX$2 million, it grants financing at preferential rates, which depend on amounts lent,” he says. For smaller loans, Vansertec turns to FIDE and CIBanco because their interest rates are highly competitive. “There are even financial leasing companies increasingly interested in providing capital for these projects, such as Central Leasing.”