Plugged in

On the heels of its recently concluded year-long presidency of the United Nations Conference on Climate Change (COP16), Mexico is soldiering on with its sustainability policy blitz.  In late November, the Federal Regulatory Improvement Commission (Cofemer) issued its approval of proposed new regulations under which independent entities generating power from renewable sources may connect to the national electricity grid.  Last year, we reported with great satisfaction that the Energy Regulatory Commission (CRE) had created a contract that allowed independent producers of energy for their own consumption to connect to the grid via a net metering system.    The new regulatory document, under the nimble title “General Rules of Interconnection to the National Electric System for Generators or Permit-holders with Renewable Energy Sources or Efficient Cogeneration,” is intended to streamline the process and lower the overall cost of grid integration for independent producers.  The administrative, legal and technical requirements, formerly distributed among various prior documents published by different agencies, will now be incorporated into the single regulatory document.  The Energy Ministry (Sener) may now publish the new regulations in the Official Gazette, with the hope that facilitating the process will hasten the contribution of new and more environmentally friendly generating plants to the country’s energy supply.  If you feel you must, you can read the Cofemer’s final opinion on the new regulations here (oh go on, we did).

On another front, not content with the success of the incandescent-for-CFL light bulb exchange program we told you about a few weeks back, energy authorities have now hatched a new scheme to promote the use of LED lamps.  Under a pilot program set to begin January 1, 2012 in the Mexico City, Monterrey and Guadalajara metropolitan areas, residential electricity customers in good standing will be able to obtain LED lamps at subsidized prices.  Federal Electricity Commission (CFE) customers will receive an eligibility notice on their electric bill that they can take to selected stores and present in exchange for an LED lighting product, which will be charged to their electric bill at a discounted rate.  Sener is looking to popularize LED technology not only for its energy saving virtues but also with the hope of developing a domestic market appealing enough to attract investment to manufacture the lamps in Mexico.

In the throes of an energy saving frenzy, the federal government also announced last month the creation of a new multi-million dollar fund to assist businesses in replacing older and less energy efficient equipment.  The program, called CFEfectvo, will provide technical evaluations of the energy efficiency of industrial operations and access to subsidized credit for the acquisition of current technology.  Sener has set the lofty goal of achieving energy savings of 30% in the country’s industrial sector through full implementation of the program.

Read about our participation in the Mexico Today program here.

Be the first on your block

Mexico’s progress in making greater use of renewable energy sources has long been shackled by regulatory restrictions on independent energy generation by private enterprises and citizens.  This, of course, has much to do with the histrionics of political sectors that oppose energy reform for reasons wholly unrelated to energy, but that’s another topic.  It’s a fundamental problem of, as we say in Mexico, “ni picha, ni cacha, ni deja batear.”  The resources of the Federal Electricity Commission (CFE) are far too stretched to finance a wide range of innovative alternative generation projects, particularly at the micro level, but regulation has largely prevented anyone else from generating electricity, even for their own consumption.  Some furtive steps toward modernization of the regulatory framework fortunately have been taken in recent years.  One such step, introduced almost surreptitiously in 2007, was the Interconnection Contract for Small-Scale Solar Energy Sources, which permitted private generation of up to 10kw for residential use and 30kw for general low tension use.  Although the practical impact of this regulatory innovation was virtually nonexistent, it is significant nonetheless in that it represents Mexico’s first toe-dip in the waters of net metering for private electricity generation.  Now, however, the government has taken another important step forward toward clearing the way for wider use of net metering for private electricity generation.

The Official Gazette (Diario Oficial de la Federación) published on April 8 a new Interconnection Contract for Renewable Energy Sources following its submission by the Energy Regulatory Commission (CRE).  The new contract, which supplants the Interconnection Contract for Small-Scale Solar Energy Sources, represents two important advances: 1) it expands the parameters of allowable independent electricity generation by allowing residential users and small businesses to produce higher volumes of electricity than under the previous net-metering mechanism; and 2) it allows for net-metered independent generation using “renewable sources” of energy rather than limiting the scheme to small scale solar generation.  The new contract also details the methods and procedure for billing and crediting deficits or surpluses once consumption and generation are accounted for.

Expanding the permissible generation methods to include wind, hydro, tidal and other alternative energy sources removes an important constraint from non-governmental energy development.  The step also should help to raise awareness of opportunities for net metering and independent power generation in general in the country, which heretofore has been low, to say the least.   A high profile, friendly promotion campaign to spread awareness and demystify independent generation would be welcome, but we’re not asking for miracles.  For now, the efforts of environmental groups, specialized equipment dealers and early adopters will have to suffice.  But at least we’re moving forward.

For anyone interested in examining the new contract, the details are published here.