View from the Top

Windpower Giant Bets on Solar

Wed, 02/21/2018 - 17:09

Q: Which renewable source is the top priority for EDF?

A: Since our arrival in Mexico in 2001, we have bet heavily on wind power. Today, the 68MW we operate comes 100 percent from wind farms. In the second long-term electricity auction, we won two projects, one 252MW wind power project in Oaxaca and a 90MW solar PV farm in Sonora. Considering the evolution of Mexico’s energy market, we are responding to this development by focusing our attention on wind and solar power, while at the same time scouting opportunities in mini-hydraulic projects.

Q: What challenges is Mexico’s electricity infrastructure facing?

A: PRODESEN outlines the construction of the first highvoltage direct current line from Oaxaca to the center of Mexico, with a transmission capacity of 3,000MW and a length of 610km, with two 500kV circuits. The project will be carried out through an open bid process under a PPP scheme and is set to become operational by 2021. In total, there will be four lines of this type in the country. These projects will ensure grid interconnection for the upcoming projects in renewable energy, which is set to increase our total electricpower capacity. For us, this is Mexico’s greatest challenge. The abundant renewable resources are there, as well as the financing to develop them. Social and environmental impact assessment processes for renewable energy projects can also be improved and social unrest addressed, but this is progressing. Infrastructure, in contrast, has to be operational without delay.

Q: How has wind farm development changed since 2013?

A: The changes implemented by the reform are overwhelmingly positive. Everyone involved, including CRE, CENACE and the Ministry of Energy, have clear responsibilities and know the issues very well. Local governments in particular, as shown by our work in Sonora and Oaxaca, have surprised us with their involvement, making sure our projects are implemented smoothly. The overall process pertaining to permits has also become more efficient.

Q: How is EDF facing the industry’s human capital availability challenge?

A: Our company’s approach is twofold. First, we bring in highly-qualified professionals with solid expertise, both from the local and international markets, capitalizing on our presence in over 22 countries. Second, we are backed by EDF’s US branch office in San Diego and its vast structure. The San Diego office has more than 1,000 professionals, while our Mexico City office has 100. We are in constant communication when it comes to personnel requirements or outlining effective commercial strategies.

Q: How will EDF allocated its US$800 million investment in Mexico?

A: This investment is intended for the two projects we won at the second long-term electricity auction. The wind farm project will receive between US$500-600 million and the PV solar park will receive the rest. We are estimating both projects will generate around 2,500 temporary jobs and 100 permanent positions once both projects are completed.

Q: What are EDF’s long-term ambitions in Mexico?

A: In 2001, we made our first moves in the industry. In 2008, we planted our foundations with the La Mata La Ventosa wind farm. Between 2010 and 2011 we created two more wind parks. In 2015, this meant 400MW of installed and operating renewable energy. In 2016 alone, we practically won another 400MW, duplicating in a year what took us 16 years to achieve. From here until 2021, our goal is to operate a total of 2,000MW. To achieve this, we are counting on both auction participation and PPAs. Of the 300MW we have in Oaxaca, 252MW were won at auction and 50MW are operating under a PPA. Our potential off-takers can count on EDF’s longstanding expertise, top-tier technology and its firm grip across the entire value chain. EDF’s differentiator is its presence throughout the different phases and entire lifespan of a project.

EDF Énergies Nouvelles is a global IPP based in France that generates, develops, builds and manages renewable energy projects. In Mexico, EDF operates 392MW of wind power and is developing 300MW of wind and 365MW of solar PV power.