Business Intelligence Unit 2015

Business Intelligence Unit 2015

Wind Solar Biomass Marine Total

# of projects Under About to start construction operations Total % Share MW Sonora 25 237 518 755 19% Chihuahua 20 181 495 676 17% Coahuila 12 184 149 333 9% Durango 14 156 136 292 8% BCS 10 117 97 214 6% Zacatecas 8 60 180 240 6% Jalisco 11 149 70 219 6% Guanajuato 9 64 149 214 6% Sinaloa 6 150 30 180 5% Aguascalientes 6 60 120 180 5% Tamaulipas 3 90 90 2% SLP 3 30 60 90 2% Otros 17 271 80 351 9% Total 144 1,749 2,084 3,833

ANNUAL MW

PV projects currently under construction in Mexico reached a value of 1,700 MW, this fact placed the country in third place for attractiveness to investors, developers and manufacturers of the industry.

Cells, Raw Materials (e.g. silane, monolithic integration and Project Balance of Developmen CEM glass) modules Plant t Installation 1 8 8 32 21 Raw feedstock (solar -grade silicon) Ingots Wafers Cells Modules Balance of Plant Project Developmen t Installation 2 3 1 31 20

Baja California Chiapas Coahuila Durango Nuevo León Oaxaca Puebla San Luis Potosí Sonora Tamaulipas Veracruz Yucatán Zacatecas

Project Construction Bearings Gearboxes Generators Blades Turbines Development / Installation Power Generator O&M 0 0 1 1 0 55 1 10 3 Turbines Substation Foundations Cables Project Construction Power Development / Installation Vessels O&M Generator 55 4 10 Fuente: Bloomberg New Energy Finance, BNEF / AMDEE / Páginas de las empresas, 2014.

1992 1993 1995 2006 2007 2008 2009 Reform to the Law for the Public Power Service (Reforma a la Ley del Servicio Público de Energía Eléctrica or LSPEE) Publication of the Regulations of the LSPEE Approval of the Law of the Energy Regulating Commission (Ley de la Comisión Reguladora de Energía or CRE) Interconnection contract for RE sources (capacity credit) Interconnection contract for small scale solar energy sources The Law for the Use of RE and Funding of Energy Transition (Ley para el Aprovechamiento de las Energías Renovables y el Financiamiento de la Transición Energética or LAERFTE) LAERFTE Regulations 2013 Energy Reform 2014 Energy Reform's Secondary Legislation (Electricity and Geothermal)

Electricity Market Generation Pre-Energy Reform vs. Current Law Before After Private investment in electricity generation is Private sector participation in the activities of the electricity industry increases. limited. Independent power producers can secure contracts of sale with the CFE through tenders (PPAs). Small producers ( less than 30 MW ) sell power to CFE through auctions. - Generators under the self-supply scheme can generate electricity and sell it to consumers partners. The market is monopolized by CFE in the purchase and in the generation of electricity. Limited participation of private sector through self-supply schemes Private generators may sell electricity on a spot market : Wholesale Electricity Market. CFE continues generating and selling electricity to residential and small and medium industry consumers (basic service) CFE will be another competitor in the wholesale electricity market. The legal framework under which the private sector can participate as geothermal energy generator is established. Current permits for self-sufficiency, cogeneration, small production, independent production and exports will maintain their status quo or request modification according to the new parameters of the law. The electricity market shall consist of the wholesale electricity market for large users and the retail market for basic service users (residential and small and medium enterprises). The wholesale electricity market will be operated by the CENACE and regulated by the CRE. The rules of the wholesale electricity market will establish: transactions of purchase and sale of electricity, Financial Transmission Rights [1 ] and Certificates of Clean Energy, among others. This market is integrated by generators, traders of electricity, qualified users and the market of clean energy certificates.

Renewable energy Transmission and distribution Before The transmission and distribution services are operated by CFE. After CENACE will be responsible for coordinating the transmission and distribution of electricity, while the general conditions for the provision of such services shall be issued by the CRE. Limited participation of individuals through the Open Season Process [2 ]. It is allowed private investment in generation of renewable energy. The main generation scheme is self-supply The State may form partnerships with privates to perform installation, maintenance, management, operation, and expansion of the necessary infrastructure to provide services for transmission and distribution of electricity. Individuals may build at their own expense the required projects of infrastructure, or may request to CENACE to include them in the program of expansion and modernization of the National Network of Transmission and Distribution, provided that there is a net profit to the National Electricity System (SEN) [3 ]. There will be established the obligations to acquire energy certificate by the qualified users The certificates will be tradable through the wholesale electricity market and they will encourage long term electricity contracts. It doesn t exist regulatory framework that allows It has been established the specific regulatory framework for recognition, private investment in geothermal plants, the CFE exploration and exploitation of geothermal resources ( Geothermal Energy Act is in charge of the construction and generation ). The permits will be issued by the SENER and will last according to the of electricity through these resources. actitivy: Recognition : 8 months Exploration : 3 years Exploitation: 30 years