Experience in the Mexican Power Sector Helping you go forward June 2014

Experience in the
Mexican Power Sector
Helping you go forward
June 2014
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Experience in the Mexican Power Sector
We have services for the entire project lifecycle
Collaboration in public strategy
and regulatory analysis
We support different levels of Public Administration
to develop strategies and programs to stimulate and
strengthen the sector.
Financial and tax modelling
and structuring
We develop financial models for generation projects,
considering tax implications, and we collaborate
with developers to structure and obtain equity
and/or debt.
Market analysis, business strategy
and support for joint ventures
We advice local and international companies to enter
and expand in the Mexican electric sector. We support
our clients in defining local or international alliances.
Project implementation support
We collaborate in the development and operation
stages, and offer advice in capital projects programs
and portfolios to ensure the compliance of objectives,
as well as tax obligations and tributary optimization.
Trading & Retail support
We support Power generators in the search of the
most attractive costumers and viceversa.
Asset sale/acquisition advice
We advise our clients in the sale-acquisition processes
of different types of assets in the electric sector.
Experience in the Mexican Power Sector
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We have proven capabilities in multiple
assignments in Mexico
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Experience in the Mexican Power Sector
Support in developing strategies to promote the
sector in combination with federal and local
governments, as well as with private sector
associations.
Collaboration in public strategy
and regulatory analysis
Advice to utilities and international
developers regarding their strategy to enter
the national market.
Tax and financial modelling
and structuring
Participation in the financial-tax structuring
and/or review of financial models of more
than 1,500 MW.
Market analysis, business strategy
and support for joint ventures
Support for the industrial groups diversification
strategy to create energy trading units.
Project implementation support
Review of potential energy cost reduction with
or without participating in the Power Plant’s
capital for industrial and services
companies.
Trading & Retail
Assessment of the electric costs and rates for
investors in Power Plant projects
Asset sale/acquisition advice
We are present in different key areas of the sector
with various generation technologies
Wind
Solar PV
Hydro
Biomass / Biofuels
Geothermal
CCGT/CHP
Smart Grids
Energy Efficiency
Infrastructure
Energy costs
Retail
In collaboration with the public sector and some sectorial
associations we’ve assessed the effective renewable
potential and the necessary actions to promote it.
These collaborations have provided us with a deep
understanding of the electric sector, its opportunities
and obstacles.
Analysis of the
renewable energy
potential,competitive
costs and promotion
strategies with Public
Administration
and Sectorial
Associations.
The need: PwC has collaborated with the Ministry of Energy (SENER), the Mexican
Association of Wind Power (AMDEE), the Mexican Association of Hydroelectric Power
(AMEXHIDRO) and several international organizations in the analysis of the potential
for renewable energies as well as their competitive costs and promotion strategies.
Additionally, PwC has supported states governments in similar assignments.
PwC approach: Assignments have included the participation, through interviews and
workshops, of more than 60 agents from the public and private sectors. The analysis
focused on the quantification of economically efficient resources derived from wind,
geothermal, solar PV, Small Scale Hydro, biomass and CHP. Detailed action plans were
established and the benefits related to the development of the identified potential were
quantified.
Results: The conclusions were included in the National Energy Strategy, in the Official
Energy Prospectives and in the agenda of the sector, as a whole. These activities have
allowed the generation of a consensual vision of the viable potential of the Renewable
Energy in the National Electric System, as well as its role and key actions in the short-term.
Link to the summaries of the studies: http://www.sener.gob.mx/webSener/portal/Default.
aspx?id=2333
Experience in the Mexican Power Sector
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We have prepared strategic plans to enter the
electric sector with international utilities,
developers and national industrial groups
Through these assignments, we have generated a deep
understanding of the objectives of the private sector and
the opportunities in the market
Identification of
opportunities for an
Asian conglomerate.
Needs: The Client needed advice on the opportunities of the electric sector in the short and
medium-term to develop investments in Power generation.
PwC approach: The assignment included the mapping of specific opportunities in
the short-term, competiveness levels and project implementation strategy ,allowing
management to decide its focus in the Mexican market.
Results: Currently, the client is going through different Power Plant bidding processes.
Strategy to enter
the Solar PV sector
for an European
developer.
Needs: A developer of renewable energy projects with installed capacity in different
countries required support to define its strategy to maximize opportunities in the Mexican
market.
PwC approach: The assignment included a quantitative analysis of the opportunities
under different generation schemes, as well as specific market scoping, competitiveness
levels and a road map for its development.
Results: The client is currently developing more than 10 different projects in several
regions of the country.
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Experience in the Mexican Power Sector
We have prepared and reviewed financial models
and structured Power Plants and gas pipelines
for developers and financial institutions
Due to these assignments, we have been able to
understand the economic and tax components of
the projects, as well as the key factors to make them
bankable
Financial
structuring
of Solar PV Power
Plants in Baja
California.
Financial
structuring of
Wind Firms
in Oaxaca, as well
as combined-cycle
projects.
Economic
and financial
assessement of a
cogeneration
project with Pemex.
Financial and social
viability assesment
of a Power Plant
based on solid
urban waste.
Investment Fund
structuring for
environmental
projects of a
Development Bank.
Review of two
financial models
of Small Scale
Hydro and Wind
Farms
1,000 MW
550 MW
100 MW
30 MW
Experience in the Mexican Power Sector
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We have advised Power Companies
and consumers in identifying energy
commercialization opportunities
We understand the main needs of qualified users and
developers in energy trading and retail activities
PPA (Power
Purchase
Agreement) and
closing strategy with
qualified users.
Sales strategy with
generators.
Needs: A service provider wanted to reduce its increasing electric power costs, and use
renewable energies.
PwC approach: After analysing the client’s electric consumption (historical and future),
as well as the competitiveness of every key renewable resource, PwC’s team recommended
a long-term self-supply strategy. We assessed the quality of potential projects considering
the savings generated for the client and we provided support for the PPA negotiation.
Results: The client closed a self-suplying deal for a third of its consumption during the first
stage of the road map defined in the strategy.
Needs: An major international generation project developer wanted to enter the selfsupply market in Mexico.
PwC approach: PwC supported the developer with its strategy to enter the self-supply
segment by performing a detailed study of the national electric sector, analyzing the selfsupply market and defining the profile of potential consumer partners.
Results: The client is developing a cogeneration project of more than 100MW, and closing
energy retail contracts.
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Experience in the Mexican Power Sector
The CP&I team combines engineering and
construction experience and capabilities to help
our clients implement their projects
Support the
construction of a
Thermoelectric
Power Plant(1).
Organizational
realignment of an
wind turbine
engineering and
construction
contractor(1).
(1)
Needs: A client needed help to plan, monitor and report the activities of a thermoelectric
project through the direct approach of the critical issues of the planning process, the
integration of suppliers, the frequent monitoring of performance indicators (in time and
costs), and labour risks.
PwC activities: Understand and assess the construction budget to identify the costs not
considered; random verification of the finished and ongoing activites of the program;
assessment of the main causes of construction delay risks.
Needs: A leading technology company was experiencing massive losses in its international
projects. The Board of Directors requested the revision of the causes and effects of these
negative results.
PwC approach: Based on the revision of former projects, PwC analyzed the vision of the
company to implement projects. Combining the definition of roles and responsibilities in
the main projects and processes, it was possible to achieve the organizational realignment
of the company.
Results: A project oriented to a process framework; definition of 47 project roles and
responsibilities, as well as 29 key processes.
International Experiences
Experience in the Mexican Power Sector
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We have offered tax and legal advice to several
developers on power generation processes
We understand the needs of our clients, we provide tax
and legal advice to implement the best structure, based
on their business Vison and expansion plans
Needs: Support in planning a more effective and flexible organizational structure to
achieve the proper compliance with tax obligations and the optimization of their tax
burden.
Activities: Understanding the client’s business vision, current and future expansion needs
and analyzing the applicable tax framework to make the best decisions for an optimum
organizational and tax structure.
Results: Planning and implementing structures, based of the client’s business vision,
finding a balance between its tax obligations and their optimization.
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Experience in the Mexican Power Sector
Our experience in this type of assigments
has made us a reference point in the sector,
allowing us to participate in its sustainable
development
The study “8%+: Sector privado y crecimiento bajo
en carbono en México” (8%+: Private sector and low
carbon growth in Mexico), elaborated with the Private
Sector Commission for Sustainable Development Studies
(CESPEDES) along with the World Wide Fund (WWF) and
PwC, analyzes the potential for reduction of greenhouse
gas emissions through profitable actions for the
private sector and identifies the actions needed for its
development.
Link: http://www.cce.org.mx/cespedes/
The study “Plan integral para el desarrollo de las energías
renovables en México 2013-2018” (Integrated Plan for
the Development of Renewable Energies in Mexico 20132018), elaborated by Iniciativa Mexicana para las Energías
Renovables (IMERE), WWF and Climate Works Foundation,
shows various scenarios and actions needed to develop
renewable energies in the short-term. The analysis is based
on the work peformed with the Ministry of Energy and
other sector associations. The quantified potential
is mentioned in the National Energy Strategy
2013– 2027.
Link: http://awsassets.panda.org
Experience in the Mexican Power Sector
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Key Contacts
Francisco Ibáñez
Capital and Infrastructure Projects Lead Partner
[email protected]
+52 (55) 5263 6085
Irene Hernández
Corporate Tax Partner of Capital, Infrastructure
& Energy Projects
[email protected]
+52 (55) 5263 8647
Juan Carlos Rojas
[email protected]
+52 (55) 5263 5821
Luis Infante
[email protected]
+52 (55) 5263 8973
Eduardo Reyes
[email protected]
+52 (55) 5263 8967
Guillermo Pineda Montiel
Energy Lead Partner
[email protected]
+52 (55) 5263 6082
Antonio Martínez Dalmau
Energy, Strategy and Operations Partner
[email protected]
+34 915 685 338
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