Break Free From CFE

Mexico hopes new guidelines spur more people to use solar energy

In an attempt to boost rooftop installations of solar energy systems, the Mexican government is making it easier and more appealing for residential and commercial consumers to invest in solar energy.

Mexico’s energy secretary (SENER) presented new regulations earlier this year that will help cut down on the amount of red tape people must endure to connect smaller solar energy systems (those with a generation capacity of 500 kilowatts or less), to the national electricity grid. The new regulations simplify the connection process, and shorten the time needed for processing applications and installing the two-way ‘smart’ meters that keep track of how much energy a home or building has produced and stored in the grid.

solar.jpgThe new regulations also put a maximum of 13 days on connecting a solar system to the national grid (18 days for more complicated connections). And residential customers with larger solar energy systems are now allowed to connect solar systems up to 25 kilowatts of capacity (only 10 kilowatts were allowed before). Low voltage commercial customer’s connection limit was increased from 25 kilowatts to 50 kilowatts.

Where does the CFE fit into all of this? Well, previously, the CFE was responsible for the review and approval of connection applications and installation of the smart meter. Moving forward, Mexico’s national energy control center, CENACE, will oversee the review process and meter installation. The change was made to remove any potential conflict of interest with the CFE’s new solar subsidiary company, and remove uncertainty on how long it will take to connect solar systems to the grid.

The new solar regulations are part of the government’s broader energy reform agenda and long-term goal of generating 25% of the country’s electricity from clean sources by 2018; 35% by 2024; and 50% by 2050. The government also hopes the regulations will help it reach its goal of eventually having 500,000 domestic rooftop solar systems, or 5 percent of all homes in Mexico, connected to the national grid. The government claims this would save the country $314 million USD in subsidized electricity generation costs that are currently provided to assist Mexican families with the high cost of electricity.

Although these new regulations might make it easier for home owners to connect to the national solar grid, it’s hard to gauge whether the regulations will have the government’s intended effect of boosting solar panel usage. David Ochoa, the owner of Cabo Green Power, has his doubts.

“I think it has to be more motivated by people paying too much for electricity,” he says. “I don’t think a regulation or process, one way or another is enough of an incentive. I think it has to come from people wanting to be more environmentally friendly or wanting not to pay through nose for electricity.”

According to Ochoa, electricity rates have been going up about eight percent per year for the past few years for commercial and domestic high usage consumers (most of Los Cabos’ high end areas, like Palmilla and Pedregal, fall into that latter category). “We’ve been getting a lot more calls, because people are starting to realize that this could be a never ending price increase,” he says.

He’s seen people who have large homes and heated pool get billed thousands of dollars a month for electricity. For about that same price, they can install one of Cabo Green Power’s small four-panel solar energy systems and start saving on their electric bills within a month. 

Ochoa says price is the main reason people are hesitant to try solar energy. Another reason is that they’re not confidant that solar energy will work as well as traditional electricity. But advances in solar energy technology have made solar panels more affordable and more efficient.

“Ten years ago, it wasn’t unusual to pay $50,000 USD for a system, and now you’d have to have a large system to reach that, a large commercial project,” Ochoa says. “The price is less than half of what it was for solar panels, and the efficiency has increased.” This means that homeowners can usually recoup their investment in three to five years and some even faster than that, depending on their energy usage.

Installation time has also decreased. It used to be that people had to wait (and pay more money) for solar panels and equipment to be imported from the U.S., but that is no longer the case. From the time a customer makes the decision to go solar to the time their system is up and running is usually two weeks, Ochoa says. And you don’t even have to see the panels once they’re installed. In the U.S. and Canada, the sun is at a lower angle so the solar panels have to be standing upright at an angle to catch the sun’s rays, which means everyone in the neighborhood can see them sitting on top of your house. But here in Baja, the angle of the sun is higher so the panels can lie flat on your roof. And on a cloudy day here, solar energy systems can still produce about 50% of what they would on a sunny day.

While some communities like Pedregal have about five to 10 percent of homes using solar energy systems, Ochoa estimates that overall only about one percent of Los Cabos is using solar panels. That’s a number that he, like the Mexican government, hopes to see increase over the next few years.

“More people should just look into it and see what it can do for them,” he says. “The technology has improved, it’s much more user friendly, people can even monitor their system in Mexico from Canada or the U.S., and from 10 years ago the price has dropped dramatically, so it’s much accessible than it was.”   ,