News Article

Well-Planned Projects May Surpass Larger Competitors

Wed, 02/19/2014 - 11:07

Most wind power projects in Mexico are developed by large global companies from Spain, Germany, or the United States. Zapoteca de Energía, on the other hand, is a development of the Mexican conglomerate Grupomar as part of its efforts to diversify its assets and investments in renewable energies. At a time when many wind companies are turning their attention away from Oaxaca to other states, Zapoteca de Energía is proud that its flagship project, a 70MW wind farm in Juchitan, has contributed to the rise of Oaxaca. Zapoteca de Energía’s Executive Director, Adrián Escofet Cedeño, admits that Oaxaca has had problems, but disagrees the state is losing its shine for the wind sector. “Setting up wind plants there is complicated, it requires a big effort in terms of money and time, but it is achievable. The proof lies in the 2GW of wind power operating in Oaxaca,” says Escofet Cedeño.

Grupomar invested in this wind farm to generate power for its own plants, but external off-takers were also sought. Escofet Cedeño says the search for off-takers involved Zapoteca de Energía approaching different types of companies than some of their competitors. “We have to compete in an open market. Everybody looks for the sophisticated, globalized companies but these are almost booked up already. This means there is a large and virtually unexplored market in Mexico among smaller companies, who have energy demands ranging between 5MW and 15MW. Electricity is an important part of their costs and they are keen to discover how they can diminish this part of their production costs. Since our wind farm is not that big at 70MW, it gives us the flexibility of working with lower-demand type of clients,” explains Escofet Cedeño. Additionally, he points out that with the Energy Reform giving chances to small producers, more projects on a smaller scale are likely to emerge. He adds that without their contribution in the wind energy, it will be challenging for the government to meet its target of having 12GW of installed wind capacity by 2020.

Zapoteca de Energía has carved itself a niche in the small- scale energy production market. The company does not wish to limit itself to any particular combination of renewable energy sources, as its objective is to develop as many renewable projects as possible, based on costs and feasibility. “There is a lot of contradictory information surrounding renewables which drives how companies invest. Many companies prefer wind because they think hydro is too complicated. Others prefer hydro because they see it as easier to manage. We try to choose the best possibilities in order to maximize our return on investment and flexibility to present an optimal power offer to our potential off-takers,” explains Escofet Cedeño.

Zapoteca de Energia is planning exponential growth by 2020, and the goal is to expand far beyond Oaxaca. Zapoteca de Energía’s most important projects are located in Oaxaca, Tamaulipas, and Nuevo Leon, and experts are currently analyzing sites in the north of Mexico for their next endeavor. Zapoteca de Energía believes the renewable energy sector will offer many opportunities and is the third sector in which Grupomar wishes to become an important player. Zapoteca de Energía wants to become a significant player without growing too much in order to avoid having to compete with the largest companies in the industry. “Our goal is to have a fair share of the market with projects that are not necessarily big but are very well- planned, have flexibility, strong optimization capabilities, and offer benefits for off-takers,” Escofet Cedeño points out. Larger companies have specific goals measured in megawatts, but Zapoteca de Energía’s model allows for more time given to meticulous planning.