Mexico is primed for a massive buildup of its solar, wind generation and transmission lines in coming years, a move which can yield huge economic and grid benefits to American companies and consumers, industry leaders on both sides of the border say.
Despite recent escalating tensions spawned by Trump administration’s emigration and border wall proposals, Mexican and American grid leaders say efforts to develop a cross-border, 21st century electric grid will have huge, thusfar largely unheralded benefits.
Within Mexico, the goal is to bring more supplies of more affordable electricity to vast swaths of the nation, improving the lives of millions and the economic muscle of the world’s 11th highest economy.
For California, now executing ambitious plans to throttle greenhouse gas emissions, ramp up renewables and energy storage, bulking up grid connections to Mexico will allow for efficient use of expensive assets when homegrown demand flags.
The coming expansion of Mexican electrical development will create many new business opportunities for solar and wind generation equipment manufacturers, engineering firms, software companies, consultants and electric utilities pursuing new business opportunities.
Many of those benefits will flow to neighboring California, the fruits of Gov. Gerry Brown’s major initiative three years ago to forge and sign a climate change pact with Pedro Joacquin Coldwell, Mexico’s secretary of energy.
Brown’s trans-border energy initiative underscores California’s efforts to step out on the world stage in bold new ways even while America’s federal government is mired in debates about the reality of climate change and pre-occupied with rolling back energy and climate initiatives of former President Barack Obama.
Solar manufacturers in America are elated with Mexico’s green focus.
Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, which represents 1,000 solar companies, said, “It’s clear that Mexico is seeing the same conditions in the solar market that we are here in the United States and many of our companies, across the supply chain, are poised to help Mexico meet its expanding solar demand.”
Shane Messer, U.S. vice president for sales and marketing for SolarWorld, the largest U.S. maker of photovoltaics, said, “A lot of the experience from the United States is translating into growth of solar applications in Mexico, and we expect very robust growth in coming years in light of energy infrastructure limitations there.”
Gerry Cauley, NERC president and CEO, left, last summer met with Mexico CRE Chairman Guillermo Garcia Alcocer and Commissioner Marcelino Madrigal.
Gerry Cauley, the head of the North American Electric Reliability Corp., which oversees the reliability and security of the bulk power system in North America, has quietly traveled to Mexico six times over the past 18 months along with technical teams to discuss the future of the electric grid both within Mexico and its further integration with the power system serving the United States and Canada.
“They have great, aggressive goals,” Cauley told the Energy Times.
Those goals are allied with robust efforts to create a new, national market for electricity in Mexico that will reward investors and energy users alike.
“It’s a real big promise and commitment made to the citizens of Mexico,” Cauley said.
Cauley predicted that within two decades, trans-border electricity flows between Mexico and the United States will be a strong as the robust energy exchange today between Canada and our country.
“It won’t be long,” Cauley said.
One goal is to integrate large, untapped wind power in Mexico with the U.S. grid, just as today we benefit from imported hydroelectric power from British Columbia and northeast Canada. At the same time, California solar energy can be shipped south during periods of the day when it is not needed in the Golden State.
“Together, we are much more reliable. As wind and solar come on, there is a great opportunity for two-way exchanges,” Cauley said.
The United States imported 68.5 million megawatt-hours of electricity from Canada in 2015 and we exported 8.7 million megawatt-hours of electricity to our northern neighbor, according to the U.S. Energy Information Administration.
In comparison, we imported 7.3 million megawatt-hours from Mexico and exported 392,000 megawatt-hours to our southern neighbor.
Mexico’s electricity flows would have to increase 10-fold to reach parity with Canada’s power exports.
Parallel to strengthening grid connections with the United States, Mexico is tasked with a major effort to build up its national grid.
“There is a tremendous amount of work to connect within Mexico,” Cauley said. He pointed out the lower Baja California is an energy island, under-supplied with electricity that is expensive.
Mexico’s electric grid modernization is already well underway, often with the help of U.S. companies.
“They utilize the same computer suppliers as the United States, and they have a fairly modern control system,” Cauley said.
On the vital question of grid security, Mexico is a fast learner. “That has been an area where NERC has been able to help them,” Cauley said.
Guillermo Zuñiga, commissioner of Mexico Energy Regulatory Commission, recently told the Energy Times that his country plans to increase its solar power generation 25-fold in coming years and its wind generation five-fold.
Zuñiga will keynote the upcoming Renewables Rush executive energy conference in San Francisco on April 5, which will explore a wide range of issues, including the implications of the growing energy alliance between Mexico and the United States.
Mexico is out to bust the piñata of what has been a long constrained, state-managed grid, and a cornucopia of benefits will now shower Mexicans and Americans alike.
“In reality, it is extremely positive for both countries,” Cauley said.
Mexico’s efforts, Cauley said, are “applaudable.”