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May 12, 2016


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Looking at the projected share of renewable energy, it's obvious Mexico will have to invest in storage (hydroelectric?) or update its grid to accommodate the drastic swings in solar production and the requirement for more peak natural gas plants.

Is Mexico investing in storage, or updating its grid to make its longer-term renewable goals achievable?

Coincidentally (or not, actually) the government just announced its smart grid program:


Now, this is more of a road map than a concrete plan. But it's important.

In addition, there are plans to invest $17 billion in T&D by 2029. An English-language summary of how that will work can be found at: http://www.pwc.com/mx/es/industrias/archivo/20150813-ms-prodesen-ingles.pdf.

The thing to keep in mind is that Mexico is in the middle of a wholesale reform of its electric market. The Electric Industry Act put responsibility for creating a competitive market on a new organization, Cenace, which is still figuring out how exactly to do its job.

But the country should be on track to meet its (modest) renewable goals. The real question is whether the country will increase those goals in light of the falling cost of solar. That would require further and faster movement on both building new power lines and upgrading the ones that exist.

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