8/3/2019 ProMexico: Negocios Magazines: Mexico - A Green Giant

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A GREEN GIANT Investment levels show Mexico is more engaged than ever in the battle to combat climate change.

by Gustavo archiGa

14 Negocios

8/3/2019 ProMexico: Negocios Magazines: Mexico - A Green Giant

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sPeCial feature Green Giant

As host of the 16th UnitedNat ions FrameworkConvention on ClimateChange (COP16), in 2010,Mexico undertook a

commitment to promote strategies to addressclimate change.

The primary goal of the Conventionwas to urge the international communityto adopt concrete decisions to mitigate theeffects of climate change. From a pragmaticstandpoint, one of its greatest achievementswas to secure political and monetary supportto ease adaptation to climate change and tofacilitate the transferral of technology and

nance projects, especially in developingnations.

One year later, Mexico has laid firmfoundations for a green future, earmarkingover 6.25 billion usd that will be channeledinto projects to combat climate change overthe coming years.

Mexico is a country blessed by nature.We have significant renewable energyresources distributed throughout the entire

country, says Sergio Alcocer Martnez,undersecretary of Energy Planning andTechnological Development at the Ministryof Energy (SENER).

Not only do we have 12,000 kilometers of coastline capable of generating wave, tidal,thermal and salinity gradient or osmoticpower but also 20 states in the country havewind power potential and we receive 50%more insolation than countries like Germany,for instance, which are more advanced in

terms of solar energy. Virtually the wholecountry has geothermal water resourcesand biomass is another renewable energywe should be exploiting.

The move toward cleaner, renewablesources of energy has been coupled withgreater awareness of the need to make moreef cient use of the energies already at ourdisposal.

For example, under the so calledGreen Mortgage program introduced bythe National Workers Housing InstituteFund (INFONAVIT), some 122,000 houseshave been built to incorporate energysaving technologies such as solar waterheaters, compact fluorescent lamps andsmart windows. Property developers Geo,Homex, Urbi and Grupo Ruba spearheadthe program, accounting for almost 30% of these affordable green homes.

Another point in Mexicos favor is thecredit line granted by the Inter-AmericanDevelopment Bank (IDB) to combat climatechange.

Since 2008, the Ministry of the

Environment and Natural Resources(SEMARNAT) has received a total of 1.2 billion usd from the IDB, which will bechanneled into speci c projects to addressclimate change.

The IDB loan has also served to bolsterconfidence among companies with anenvironmental focus, like Rubeniusof Arabia, which specializes in utilityefficiency and energy storage solutions.During COP16, Rubenius announced plans

to invest 4 billion usd over seven years toset up an electricity bank in Mexicali, BajaCalifornia.

In general, Mexicos renewable energiesare of very high quality, which facilitatesdiversi cation within the industry and the broadening of the production chain, saysAlcocer, adding that in Mexico, investors havethe certainty of a legal framework and a publicutility electricity law that acknowledges andencourages the participation of the privatesector in electricity generation activities, beit for self consumption or sale to the FederalElectricity Commission (CFE). Furthermore,Mexico has workers that are highly skilled inthe manufacture of components and systemsand the assembly of parts for renewableenergy products.

what the wind

is blowing in

Another project that makes Mexico a viableplayer in the green energies business isthe Eurus wind farm in Juchitn, Oaxaca.Financed by the Mexican cement company

Cemex, Eurus has a capacity of 250 megawatts,enough to meet 25% of the electricityrequirements of Cemexs Mexican operations.Eurus began operating in 2009 and has 167wind-driven generators, making it the largestwind farm in Latin America to date.

Oaxaca is one of the states with thegreatest potential in that respect, with averagewind speeds capable of generating up to5,000 megawatts a year, enough to light upa city the size of Paris.

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It is estimated that Eurus will soon begenerating enough electricity to supply a cityof half a million inhabitants, preventing some600,000 tons of CO 2 approximately 25% of total emissions generated by a city of thatsize from entering the atmosphere each year.

According to data furnished by theMinistry of Energy, as of 2010, Mexico hadan installed capacity in the region of 500megawatts, including both government andprivate sector wind energy projects. However,an estimated 5.5 billion usd will be channeledinto similar projects with a view to pushing

that gure up to 2,200 megawatts by 2012,with wind generated electricity accountingfor 4% of total installed capacity by the endof the current government administration.

The pressing need for new paradigms inthe search for environmental sustainabilitycontinues to fuel renewable energy and othergreen initiatives.

For instance, the North AmericanDevelopment Bank (NADB) has announcedthat it has 450 million usd in capital and

another 3 billion in green credit lines up forgrabs and that it will be promoting the useof renewable energies on the Mexico-US border. Baja California and Tamaulipas arecontenders for wind energy projects, whileSonora and Chihuahua could well catch thesolar power fever that is going round.

In the meantime, investment mainlyin wind and geothermal energy projectscontinues to increase, more than quadruplingto 2.32 billion usd last year compared to 2009,according to a report published by the UNEnvironmental Program (UNEP).

That is partly because Mexicos authoritiesaim to raise the use of renewable energiesas a percentage of all energy utilized from3.3%, where it currently stands, to 7.6% by2012, mirroring the global trend in whichdeveloping countries are gaining an edgeover developed ones in the use of fossil fuelalternatives.

The point is that reducing CO 2 emissionswill become increasingly important, whichputs pressure on clean energies to be more

ME ICOS GREEN FEATS Much of the progress Mexico has made in the battle to address climate change can be attributed to thedrawing up of a regulatory framework and projects implemented by states and municipalities, many of which enjoy the backing of the private sector.

For instance, the federal government has implemented the lines of action of the 2011 National Strategy for Energy Transition and Sustainable Energy Use and introduced laws for the development of renewable energies and nancing mechanisms as part of a long term plan to ensure that the countryis producing suf cient energy using ef cient, environmentally sustainable methods by 2024.

In addition to anticipating the depletion of oil reserves, diversifying energy sources, encouraging more ef cient energy use and reducing the environmental impact, the regulatory framework is built around the development of new technologies and human capital within the industry and aims to grant

marginalized sectors of the population access to competitively priced sources of energy.

cost competitive compared to gas, for example,which is the cheapest fuel, says Alcocer.

In the renewable fuels race, wind energytakes the green star, although solar energyalso has the potential to overtake countriesthat are presently light years ahead of Mexicoin the development of such technologies.

Insolation averages 6 kilowatts per hourper square meter (kWh/m 2) in the Mexicanstates of Sonora, Durango, Chihuahua, BajaCalifornia and Baja California Sur alone 50%higher than the mean in several Europeancountries that have invested heavily in solar

energy infrastructure.That means that just 25 kilometers of desert

have the capacity to generate enough solarenergy to meet all of Mexicos electricity needs,according to estimates by Nobel PrizewinnerAl Gore.

In light of its enormous renewable energypotential and the number of projects alreadyin operation or underway, Mexico is a green beacon for Latin America and the rest of the world. n

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sPeCial feature Green Giant

4%of the electricity Mexico producesshould be wind- generated by year-end2012, according to government estimates.

5,000megawatts of electricity could be generated everyyear in Mexico byharnessing windenergy.

2.32billion USD have beeninvested in windand geothermalenergy projectsin Mexico.

25km of Mexicos desertsreceive enough solarinsolation to meet allthe countrys electric-ity needs, according toestimates by Al Gore.

Tail Winds

Wind projects

8 Underconstruction(911.2 MW)

27 Underdevelopment

(7039.9 MW)

Sources: Mexican Wind Energy Association, IDB, Eurus, UNEP.

Eurus Leads the WayEurus prevents

600,000 tons of CO2 from enteringthe atmosphereevery year.

25% of thetotal emissions generated by acity of 500,000inhabitants.

The Eurus wind farm generatesenough electricity to cover

25%of Cemexs energy requirements.

Juchitn, Oaxaca.

State-financed 3Export 5

Self-sufficiency30Independent producer 5

8In operation

(518.63 MW)

Baja California

Nuevo Lon

Tamaulipas

Jalisco

OaxacaChiapas

States withwind projects

i n f o G r a P h i c o l d e m a r