Bioenergy South of the Border

Last week, I interviewed Greg Smith from Global Energy Solutions, and during our chat I asked him about opportune countries for bioenergy project development. Greg has been involved in many biomass energy projects both in and out of the country and works closely with the technology providers he represents, including Hurst Boiler. He said that right now, about 90 percent of his business is outside the border.

I was interested in hearing about activity in Mexico, as last year at the International Biomass Conference & Expo I sat in on an international panel, and one of the presenters discussed Mexico’s potential. Mexico has always had potential in that it is abundant in biomass resources—especially waste agave, leftover material from the tequila-making process that Greg said makes a great boiler fuel—but quite recently, the country’s electricity regulations have undergone massive reform.

One component of the reform—which largely serves to jumpstart economic benefit driven by the oil and gas sectors —is that it opened up the electricity market to private developers, as it was previously monopolized by the state utility company CFE. So while not focused specifically on renewables, that’s where the opportunity is. When coupled with the fact that Mexico’s electricity prices are very steep and the country has set a goal of generating 35 percent of its energy from renewable sources by 2024 (and also awards clean energy certificates), it sets the stage for new investment in bioenergy.

According to Navigant Research, in a recent ranking of the most attractive power markets for investors in Latin America, based on a survey of power sector stakeholders, Mexico is at the top of the list. From the report:

Although Mexico is heavily dependent on fossil fuels for power generation—representing 86 percent of delivered electricity—estimates suggest that it has sufficient resources to meet 50 percent of its generation demand with non-fossil fuels by 2050. Among non-hydro resources, geothermal, biomass, and waste are currently the most utilized…

I also read that as a result of these reforms, some estimates predict Mexico will add 66 GW of capacity to its power grid over the next 15 years, with investments in renewables potentially reaching $90 billion.

Not exactly pocket change.

So anyway, looping back to my conversation with Smith—as you’ll read in my April Biomass Magazine story, he and Hurst Boiler have done a lot of projects in Mexico.

“It’s a lot easier to business there than it was 10 years ago,” he said.

Be sure to check out this issue when it hits your desk. We are very proud to be in the midst of producing our very first “Imports/Exports” issue (probably long overdue), which also happens to be the largest edition of Biomass Magazine in the title’s eight-year history.

Meanwhile, while this cold spell creeps up just when we thought winter was over, grab a margarita and think Mexico.