Mexico

Mexico

Going commercial scale in Mexico -- Wal-Mart joins in

Mexico has joined its neighbours to the north with its first installation of a large, multi-turbine, commercial scale wind farm. The inauguration of the 83 MW La Venta II project brought the country's new president, Felipe Calderón, to windy Oaxaca state to do the honours.

The 98 turbine wind plant -- co-developed by Spanish team Gamesa Eólica and Iberdrola -- boosts the country's wind capacity to 86 MW. Prior to La Venta II, Mexico's only wind installations were La Venta I at 2 MW and another 1 MW at Guerrero Negro in Baja California Sur state. "The project allows Mexico to really start developing wind energy," says César Fuentes, manager of Asociación Mexicana de Energía Eólica (AMDEE).

Mexico's state energy company, Comisión Federal de Electricidad (CFE), will operate the wind power station. It signed a $111 million contract with Gamesa and Iberdrola to develop La Venta II in 2005.

Mexico's next step will be CFE's request for proposals to build and supply the 101 MW La Venta III project, says Fuentes. Construction of La Venta III is expected to start in December for completion by March 2009. The winning bidder will sell energy to CFE under a 20-year contract. The World Bank has already approved a $25 million grant from its Global Environment Facility to support the project.

EDF equity

Already lined up with its bid is Eléctrica del Valle de México (EVM), controlled by French national utility Electricité de France (EDF). It has teamed up with the Mexican subsidiary of US superstore Wal-Mart, which has its eye on using wind power to supply energy to 350 stores across central Mexico. "La Venta III is in a public bidding process, based on price, and we will deliver an offer in June to CFE," says EVM's Ricardo Whaley. If its bid is selected, EVM will build and operate the 67.5 MW wind farm, slated for 23 turbines, in the municipalities of Juchitán de Zaragoza and Asunción Ixtaltepec in Oaxaca. Equity of $140 million is coming from EDF.

The local unit of Wal-Mart is working with EVM. "We read that Wal-Mart's CEO was interested in renewable energy so we wrote to him and presented our offer," says Whaley. "We started working with Wal-Mart at the end of 2005 and secured the licenses and permits in 2006," he says. Wal-Mart will use the energy to offset 34% of its energy needs in Mexico, with savings of $2.5 million, according to Antonio Ocaranza at Wal-Mart de México.

An equipment supplier is still to be selected, but EVM expects to make its choice this month. The short list includes Gamesa, Vestas and Mitsubishi, says Whaley. If all goes to plan, EVM will start construction in October with a view to producing electricity in August 2008.

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