Mexico: A High-Growth Market for Energy Efficiency Solutions
Mexico is experiencing an increasing demand for infrastructure and services due to its economic growth and accelerated urban densification. This has led to a vast increase of energy consumption, as well as greenhouse gas emissions.
Program for Financing of Electric Energy Saving
In 2002, the Federal Electricity Commission (CFE) started the Program for Financing of Electric Energy Saving (PFAEE). This provides homeowners with financial support to improve thermal insulation and replace old and inefficient refrigerators and air-conditioners.
In the first phase (2002 to 2006), the programs improved insulation in 30,000 homes, updated 130,000 refrigerators, and replaced 623,000 air conditioning units. The second phase (2007-2012) incorporated intermediary services to ease interactions between manufacturers, distributors, collectors, customers, and appliance destruction centers.
The National Program for Sustainable Energy Use
Although the first two programs unlocked energy efficiency practices, it lacked a thoughtful long-term energy efficiency agenda. It was the Law for the Sustainable Use of Energy (LASE) the act that gave it a regulatory framework for energy efficiency practices. Enacted in 2008, it served to launch the National Program for Sustainable Energy Use (PRONASE). It set the targets, strategies, and actions for energy efficiency at a national level for all sectors.
The first PRONASE period took place between 2009-2012 but did not have much impact on energy efficiency in the country. FIDE and PFAEE, already implemented, continued to be the key programs focused on upgrading lighting, appliances, and industrial motors.
The second period, PRONASE 2014-2018, was a thoughtful plan that added strategies to optimize energy usage in processes and activities. It also sought to strengthen government agencies, promote research and development, and train professionals in energy efficiency techniques.
Energy Transition Law of 2015
One year later, as part of the energy reform, the Energy Transition Law of 2015 was enacted. This was a critical piece towards a comprehensive long-term plan for energy efficiency.
Through this Law, the government set for the first-time energy intensity goals. It established targets for a 1.9% reduction in final energy consumption intensity from 2016 to 2030, and a 3.7% reduction from 2031 to 2050. It also mandates the establishment of a road map to accomplish the golas at a national level. The first Roadmap was published in January 2017, containing 66 energy efficiency actions, a financial fund, technical resources, and timeline.
Mexico still needs to develop additional actions to better integrate other sectors such as transportation, buildings, and utilities. Energy efficiency standards for new contractions are not consolidated, and actions in terms of transportation and Demand-side management (DSM) programs are not well structured. However, Mexico has accomplished significant achievements in efficient appliances and lighting. Along with Brazil and Chile, Mexico is leading Latin America in energy efficiency initiatives.
We Have a Positive Outlook Over the Next 12 to 18 Months
Mexico has taken the first steps to achieve its energy savings goals. It has set up policies, allocated resources, and established strategies. It has reinforced relationships with the private sector and strengthened collaboration with international agencies. Mexico has become a great market to implement energy efficiency solutions and technologies.
Our Energy Efficiency Assessments begin with our consultants analyzing historical energy consumption and identifying trends or ways to optimize energy spending. We meet with building/facility staff and management about the strategy of the facility or plant, which allows us to make thorough recommendations on ways to lower the energy footprint. Please contact a consultant today to learn more about our energy efficiency and LEED solutions.
Also in Mexico Energy Insights
The coronavirus crisis placed many businesses in the unusual position of being able to save significant amounts of money through improved energy efficiency during protracted shutdowns. There are specific best practices that firms can use to determine how much they can save, safely make the changes, and then reverse the process when business starts up again.
Specific programs were created to assist firms and households in making the transition to power-saving technology. The Eco-Crédito Empresaria is perhaps the most important for small and medium-sized businesses. This credit helps firms upgrade their equipment to more energy-efficient technology.
Businesses and other organizations use 76% of the energy produced in Mexico, and they are increasingly interested in procuring renewable energy. Over 1,500 firms already use renewables, and capacity keeps rising. Mexico reached over 24,000 MW of sustainable energy capacity in 2019. As the number of market participants rises and the depth of the market increases, renewable power becomes more reliable and cost-effective.