Mexico’s sombrero is becoming every time more sustainable. Placed in a privileged location that provides it with more sun power than most countries, highly favourable winds in its southern and eastern coasts, major rivers all over the country to take advantage of hydropower as well as plenty of geothermal resources thanks to the volcanic belt that crosses it from south to north, Mexico has managed to cover 20.3 percent of its 2016 energy demand via clean sources.
Nevertheless, the country still has to face plenty of challenges to reach its goal of producing 35 percent of its energy through clean sources. While financing and cultural challenges are among the most pressing ones, it is also a fact that its recently created energy regulatory institutions and the Federal Electricity Commission (a productive enterprise of the state) have a lot to learn in a newly open market.
Here are seven challenges being faced by Mexico in terms of making its energy consumption greener. As it can be seen some of the challenges are related to a lack of information as well as to the dissemination of the already existing information, which is both frightening but also an excellent opportunity for us, energies for climate ambassadors, to step up and make the energy transition happen.
#1 Financing for small scale renewables
There is a lack of financing options for the general public to get economically-viable projects that will allow them to produce renewable energy for their own consumption. While traditional banking schemes are expensive for the lower income levels, most tailor-made financing options are for the higher income levels. One company working towards overcoming this problem is Bright, a startup working towards making it possible in the future to install solar panels in lower income houses.
#2 Interconnection bureaucracy – what a nightmare
CFE takes care of the transmission and distribution grids in Mexico, as well as almost all of the generation. For every residential or industrial project that wants to get connected to the grid CFE has to make a study, validate and perform the interconnection. This is a crazy amount of work that the company is not capable of handling. Galt Energy is a company that has managed to cluster its interconnection procedures to make things run smoother in front of CFE.
#3 Some incentives exist, but not everyone knows them
This point is strongly involved with the two previous ones. We already said that its is hard to find proper financing, and also that interconnections processes can be a hurdle, but this can be overcome given that the right incentives are provided for consumers to go through all of that. While there are still plenty of opportunities to offer more incentives, a good start is the fact that the cost of the equipment bought for renewable generation systems is 100% tax-deductible for companies and the general public.
#4 Non-technical energy losses (aka STEALING)
The old infrastructure system is not the only one to blame. In Mexico, plenty of people steal electricity by illegally connecting their households into the distribution grid. As a matter of fact, the country loses around 13 percent of its energy in the transmission and distribution of it, and 37 percent of those losses come from stealing, while the rest is due to technology. This means that 5 percent of the energy produced in Mexico is taken away in an illicit way. There is much work to do in this area.
#5 Energy waste: “I pay it, I can waste it”
One of the several cultural challenges we face in Mexico is the concept that we can waste as much as we want as long as we pay for that waste. This includes energy. Leaving the lights on, leaving the TV on, using AC just to keep the room at a nice temperature even if no one is there are common ways to waste energy. Those, and other attitudes, are a day-to-day reality for many Mexican families. Given the proper incentives, families would be willing to change their habits and maybe even install energy efficiency systems in their houses.
#6 Energy access
This last point is related to the poorer zones of Mexico. While all of the previous ones are relatable for cities, this one goes for the farming and indigenous communities of Mexico. As CFE was part of the state, it did a very good job in providing electricity to whoever asked for it. That is how it managed to provide electricity to almost 99% of the Mexican population. After all, it was its obligation. Now, being a productive enterprise of the state, for that last 1% is no longer the obligation of CFE to provide them with electricity. While the Universal Access to Electricity program launched by the Ministry of Energy is supposed to work in this direction, other social businesses are already looking at the possibility of offering renewable energy systems to those communities. Vitaluz is one of them.
#7 Energy transition? I have more important things to do >:/
Increasing costs of living make people less worried about how they impact the world with their consumption. After all, they are consuming to survive, meaning that no matter the urgency of using less energy, the urgency of living is much more pressing