Luis Pineda

States Should Consider Role in Reform, Clean Energy Potential

Wed, 02/21/2018 - 09:19

As Mexico’s authorities press on with efforts to capitalize on the momentum of the country’s implemented Energy Reform, some local states are realizing their potential and the important contribution they could make toward the country’s energy transition, beyond the abundance of their renewable resources, says Luis Pineda, Commissioner at CRE.

“Tamaulipas is quickly becoming the most dynamic state in Mexico in terms of electricity generation through renewable energy, especially wind power, to the point that it is getting close to Oaxaca’s wind-power generation levels,” says Pineda. The northern state recognized the dimension and importance of Mexico’s revamped and unlocked energy sector by creating its own Energy Commission, the equivalent of a local State Ministry. “Usually, a state’s energy sector is imbedded in its economic development ministries (SEDECO), which focus on industrial clusters and corporate projects, placing energy in second place,” Pineda says. Tamaulipas’ Energy Commission’s efforts are starting to pay off, as Danish wind-power heavyweight Vestas announced in July 2017 the installation of a wind turbine production plant in Reynosa.

“Some energy projects are going the extra mile by inviting local communities to be active participants of utility-scale wind-power projects, avoiding the problems generated by lack of interaction, sensitivity and the establishment of communication processes and agreements with local communities. No matter the technology, be it solar, wind or hydroelectric, all are vulnerable to being stalled by excluding local communities,” Pineda adds.

Pineda also recognizes the efforts and opportunities that other states are capitalizing on. “Baja Califronia Sur has the largest operating PV power plant in Latin America to date, Aura Solar I, launched in 2013 and which generates 82GWh of electric power per year. Guanajuato’s Puerto Interior industrial park inaugurated DESMEX’s 3MW solar power plant in 2010 and Enel Green Power launched the construction of the Don José 238MW solar power plant.”

Despite these major milestones, much work remains to be done. For instance, “Michoacan’s ‘green gold’ sector, agroindustry in general, and avocado in particular, has yet to grasp the benefits of solar power for energyintensive processes such as refrigeration,” says Pineda. CRE’s Institutional Liasion Office is working to ensure Commissioners are present at specialized forums that cover themes such as electricity, hydrocarbons, natural gas and LNG, and organizes workshops pertaining to these technologies. “The idea is to captivate corporate decisionmakers and direct their investment appetite toward cleaner and greener power-producing technologies.”

He says associated markets will also play an extremely important role in the success of the reform. “The reform will be successful only as far as its associated markets work. Our fundamental goal is to provide the required regulation for all these markets to be economically sound,” Pineda says. “The sustainability of the electricity market and the use of clean, reliable and sustainable power generation technologies, with the required interconnection infrastructure and assistance of CENACE through institutional coordination go hand in hand in removing persistent entry barriers.”

To remove these barriers, CRE’s General Administrative Dispositions and other regulatory mechanisms enact the technical conditions to establish the reliability, security and sustainability of Mexico’s renewable-powered generation projects, echoing Mexico’s commitment to the Paris Agreement of 2015. “Through Normalization Committees, we design the Official Mexican Norms (NOMs) integrating the incentives and proposals embedded in the best international practices and tailored to Mexico’s specificities,” Pineda says. This includes solidifying Mexico’s manufacturing know-how and extending it to renewable energy-related products. “CRE can coordinate with privatesector players involved in manufacturing and project developers to regulate effective technical specifications for renewable technology parts and products that are best suited for Mexico’s electricity system, under its technical specifications.”