How Green are energy reforms in Mexico?

Adrian

 

 

Posted by:
Adrián Martínez Espitia
Energy and Sustainability Services, Latin America

In 1962, Thomas Khun established “The Structure of Scientific Revolutions” about the occurrence of models substitution, where new models simply become better than previous ones.

During recent years Mexico has been approving law reforms that foster another type of investment and take advantage of other types of resources that had not been previously explored. In 2008, Mexico took an important step by issuing the “Law for the Exploitation of Renewable Energy and the Energy Transition Financing”. Since then, Mexico has been intensively approving reforms that have created attractive business opportunities for companies. In 2012 the General Law for Climate Change was also published, and contemplates a Greenhouse Gas Reduction by 20% for 2020 and by 50% for 2050 in relation to the baseline. These two laws have also set another goal in order to generate 35% of electricity from clean energy sources for 2024. However, Mexico’s sources of non-fossil fuels represent about 17% of electricity consumption (mostly hydro). Therefore, the question remains, how would the renewable energy portfolio duplicate in just 10 years?

Historically, the energy sector in Mexico has been controlled by government companies for both extraction, refinery and sale of fossil fuels as well as generation, distribution and sale of electricity. The first has been monopolized for almost 80 years by (PEMEX), they were the only ones allowed to extract, process, distribute and sail of oil and gas. The electricity sector and its company (CFE) had also controlled generation, distribution and sail since 1933, nevertheless, some changes have occurred in last years.

In December 2013, Mexican government made a historic important step by approving an Energy Reform. This reform consists in the allowance of private investment for the exploitation of oil and gas as well as for electricity generation. During June 2014, the bylaws will be reviewed in the Mexican Congress. These bylaws in the weeks ahead will certainly cause an energy revolution and change the market competition. Regarding hydrocarbons, new investments are pointing mainly toward the extraction of oil in deep oceans and shale gas in several rich areas, especially, in the North of Mexico.

The bylaws are also contemplating the creation of an electricity generation market, where the State shall not lose power of the control of the national electric system and the exclusiveness of transmission and distribution of electrical energy as an important public service. With this, CFE and private companies under government supervision, shall boost the national electric system that therefore, would decrease electric tariffs. The property of generation plans and the transmission and distribution networks will remain owned by CFE.

The new electricity market will also implement The Clean Energy Certificates (CELs) that seek to promote a better electricity generation from clean energy that would, in most cases, be related to renewable energies.

But, how will it work? The Government will establish a yearly minimal electricity generation from clean sources, which shall be covered by either generators or distributors. If generators or distributors cannot cover it, they must buy the number of Certificates that help to comply with such obligation. If they don’t comply, either generator or distributor will have to pay a significant fine to authorities that would represent the Certificates maximum price.

Renewable energy plants can obtain more resources by selling two goods:

  1. The electricity that they generate and sell to the grid, or to any other consumer out of the electric grid.
  2. The Certificates that represent environmental rights and its benefits, materialized in commercial credits.

Going back to the title of this article, we could conclude that Energy Reforms contemplate the exploitation of fossil fuels in a massive scale, and will certainly pollute more and not be green. However, established and ambitious goals have been set and Mexico became the first developing country to issue a Climate Change Law that will bring cleaner energy. In addition, CELs in Mexico will make clean technologies financially attractive and will marginally penalize pollutant generation plants.

We’re Bringing Amsterdam to Chicago

Bob-Best-85w

 

Posted by:
Bob Best
Energy and Sustainability Services

 

I was in Amsterdam last year and stunned by the incredible number of bike riders.

Looking at U.S. cities, with our car traffic and parking problems, any effort to match a bike-friendly city, like Amsterdam, is a pedal stroke in the right direction.

This week in Chicago our “Bike Commuter Challenge” and, each year, we seem to be getting more cyclists and more attention. What a wonderful thing, especially on top of the phenomenal success of Chicago’s Divvy bike-sharing program.

BisNow asked me (below) to support the cause, which I was happy to do.

bob

Photo courtsey of BisNow and Bob Best

 

Is a green building also ‘Disaster-Ready’?

Bob-Best-85w

 

 

Posted by:
Bob Best
Energy and Sustainability Services

 

The definition of a “sustainable building” may be changing in response to recent natural disasters, like Hurricane Sandy.  It appears that more buildings are starting to include disaster planning/management/ recovery/resiliency in their sustainability efforts.

It makes sense.

We want to design and manage buildings to minimize negative impacts on the environment.  At the same time, don’t we also want to minimize negative impacts of the environment on our buildings?

Many of the features and systems that make a building “greener” can also impact the building’s ability to withstand natural disasters … electrical systems, HVAC , lighting.  And, the same teams of people work on both … managers, engineers and our contractors.    So, many building managers are combining the two approaches into over their overall sustainability programs.

After all, while we are sustaining the environment, why not go the extra step and sustain the buildings we manage and the people inside them?

Sustainability is truly good business

Dan Probst - Jones Lang LaSalle

 

Posted by:
Dan Probst
Energy and Sustainability Services

 

Earlier this week, I spoke at a press conference in Chicago supporting the recent EPA proposal, the Clean Power Plan, to cut carbon emissions from existing power plants. The electric power sector accounts for nearly 40% of today’s greenhouse gas emissions, and the EPA’s initiative to cut carbon emissions from existing power plants by 30% nationwide is a significant step towards a more sustainable built environment.

Buildings are responsible for up to 70% of electrical consumption in major cities and up to 40% of greenhouse gas emissions. So improving the energy efficiency of our buildings represents one solution to reducing greenhouse gas emissions.

The good news is that there are technologies and resources available to support building energy efficiency initiatives. While power producers can make efficiency improvements to their plants, substantial efficiency opportunities also lie within the commercial buildings sector. Sound energy management strategies represent a great opportunity to reduce both emissions and energy costs for building owners.

Over the last 5 years, we have helped clients reduce their collective greenhouse gas emissions by nearly 12 million metric tons. In the process, we saved them more than $2.5 billion in energy costs. Cost reductions aren’t the only benefit of building energy efficiency improvements.  Building investors are finding that green buildings are more attractive to tenants and owner occupiers are finding that improved environmental performance can make their company more attractive to employees, customers and shareholders. Research indicates that as many as 90% of American workers want to work for a company with a strong green reputation.

Carbon emission regulations can also create jobs. The U.S. Green Building Council says that, from 2009 to 2013, green construction generated nearly 8 million jobs in the U.S., and nearly $400 billion in labor earnings. These are American jobs which can’t be exported. When we managed the retrofit of New York’s Empire State Building, for example, 200 new jobs were created. There is a significant opportunity to help boost our economy and local job growth by retrofitting existing buildings to reduce emissions.

I’d like to think that more efficiently managing our electricity and power facilities is truly a “no brainer” – it will reduce greenhouse gas emissions and our impact on the planet, reduce costs for both power companies and consumers, and help drive the economy. Sustainability is truly good business and the right thing to do.

JLL’s President and CEO, Colin Dyer speaks to US Congress panel about sustainability initiatives

michael jordan outside small

 

Posted by:
Michael Jordan
Strategic Consulting

 

On April 10, 2014, JLL’s President and CEO Colin Dyer headed to Washington, DC to speak in front of the Senate Bicameral Task Force on Climate Change. Highlights include how the firm’s efforts to combat climate change benefit the environment and the economy.

Colin’s visit coincided with the one-year anniversary of the Business for Innovative Climate & Energy Policy’s (BICEP) launch of the Climate Declaration, which encourages Congress to make policies that combat climate change while boosting the economy. JLL was one of the first signatories of the Climate Declaration; it now has more than 750 signatures.

To mark this anniversary, BICEP members agreed to hold a briefing for the Senate Bicameral Task Force on Climate Change to demonstrate corporate leadership on sustainability. Colin was joined by executives from Mars, Sprint, VF Corporation and IKEA as he highlighted JLL’s commitment to sustainability:

  • Last year, JLL helped clients reduce their collective greenhouse gas emissions by nearly 12 million metric tons and saved clients more than $2.5 billion of energy costs.
  • JLL’s management of New York’s Empire State Building retrofit alone created 200 new jobs.
  • Through the end of 2017, JLL’s goals per employee are to reduce its greenhouse gas emissions and office energy use by 10 percent, and reduce its occupied space by 8 percent.

speech

Watch Colin’s briefing before the Senate Bicameral Task Force on Climate Change here (his briefing begins at 28:45).