Value Proposal Draws on DG BenefitsBy Cas Biekmann | Mon, 04/12/2021 - 14:50
Q: How did demand evolve for Latin American Rainmakers in the last year?
A: 2020 was a strange year. On the one hand, large-scale wind and solar projects were completely halted. On the other hand, distributed generation (DG) projects actually received a boost. Most of our customers were involved in DG projects because they needed certainty and quality in their energy supply, not just cheap prices. As a result, DG experienced a growth of 30 to 50 percent over the year despite uncertainty brought on by COVID-19 and the state of the economy. We had an 80 percent demand for solar and 20 percent demand for natural gas. With natural gas, the decision-making cycle takes much longer than with solar. Customer need to pass through three stages to make a decision in this area: they first need to learn about natural gas, which takes between six months and a year. Second, they need to make sure that the desired savings and quality of energy can be achieved. They do not want to face risks in this regard. And third, they want certainty that the project can be completed. In 2020, permitting slowed down significantly, making this a bit of a problem. Therefore, we began to analyze more projects below the 0.5MW threshold because they do not require the extensive permitting.
Q: How could companies benefit by taking care of their energy supply?
A: The big off-takers are not the key but, rather, the small to medium enterprises (SMEs). These SMEs are really suffering from high energy prices. They suffer most from intermittency issues because they are connected to low-voltage outlets but they are unwilling to switch to higher CFE rates. Big companies in major sectors solved their energy issues 15-20 years ago with self-supply. SMEs, however, make up the majority of energy consumption. We need to address this crisis and that is why we focus on DG – to assure energy supply and benefit our ecosystem. Everyone will benefit when companies are able to further lease capacity for residential use.
Q: What added value does the company bring to the table in regard to DG?
A: There are various areas where we can add value in this regard. As our slogan says: “Latin American Rainmakers will bring prosperity to your business through efficient use of energy.” Furthermore, our goal is to provide benefits along the entire value chain. To offer solutions, we like to say that we first put our patients on a diet before tailoring their suits. The customer needs to be in good shape first, so that we can build the right-fitting solution. To this end, we provide a complete analysis that shows exactly what a customer needs, which will be different for everyone. We also bring several alternatives to the table. This is part of our strength: we come from a big company, having gained much experience in dealing with regulations and financing questions. We do not only provide credit or pay-in-cash options; we offer innovative alternatives so that we can find the one that fits the client’s business culture and preferences. Today, we have a complete portfolio of solutions to help customers acquire solar or cogeneration-based assets.
Q: What does Latin American Rainmakers want to achieve in 2021?
A: In addition to our usual metrics, we want to continue developing DG projects in all our business segments. We are providing solar solutions for several greenhouses that grow produce. We also have projects in the mining and consumer goods industries.
We are also developing medium-sized projects, between 2MW and 50MW. We offer hybrid solutions, in which we co-invest with land and industrial park owners, as well as with other medium-sized users that are looking for smart solutions to their energy issues by improving energy quality and avoiding shutdowns. These solutions will be consolidated this year. We believe that we have an excellent value proposal for these projects in the shortest time possible.
Regarding utility-scale wind and solar farms, all of our projects have been halted for the moment. We will see how the situation in the sector develops in the short to medium term and take up the work again when it is appropriate. At the moment, uncertainty is playing a crucial role in the sector, so we want to be cautious.
In general, our expectations for 2021 are very optimistic. There is a need for sustainability in the market. The best way to increase Mexico’s GDP is by increasing the country’s electric capacity and infrastructure. Investing in transmission lines and capacity is the only way into the future.
Latin American Rainmakers is a socially-responsible company that offers reliable Power Gen (conventional & renewable), O&G and Industrial Systems Solutions backed by more than 20 years of experience in supply, engineering, design, installation and maintenance of power systems.