'Renewable energy is the future'

Monday, February 12, 2018

Latin America is a region of strategic importance for Spanish engineering firm Sener as the region builds up its renewable energy capacity, while opportunities also abound in natural gas and LNG infrastructure and combined cycle generation, according to the company's business development manager for the region.

BNamericas: How important is Latin America for Sener?

Luis Gabellieri: Latin America has great prospects for the four areas in which Sener is active: renewables, power, oil and gas, and infrastructure and transport. Latin American countries have an interesting growth rate, which will imply significant infrastructure development, both in energy and civil works, and this represents great opportunities in engineering and construction. The region is one of strategic development for the company. We have permanent offices in Mexico, Brazil, Argentina, Colombia and Chile.

BNamericas: What are the most important countries in the region for Sener?

Gabellieri: The most important ones are those with the greatest growth potential in energy infrastructure and transport: Argentina, Brazil, Mexico, Colombia and Chile. Mexico has Sener's second-largest office by number of employees, and we have some important energy projects in that country, such as the Empalme I and Agua Prieta II combined cycle plants, the modernization of the Salamanca refinery, the La Laguna-Aguascalientes and the Villa de Reyes-Aguascalientes-Guadalajara natural gas pipelines, and the two pumping stations for the Los Ramones I pipeline, to name the most recent.

BNamericas: Is Sener involved in engineering works at the Puerto de Açu thermoelectric plant in Brazil, and does the company plan to compete for projects in that country?

Gabellieri:  Yes, we are working on the engineering of that plant, and more generally we have an office in Brazil focused on contracting and executing local projects, in renewables, electric power and oil and gas.

BNamericas: With such significant growth in renewables in Latin America, where do you see the greatest opportunities, in thermoelectric plants or solar parks?

Gabellieri: In Mexico, combined cycle, and in Chile, solar. In Mexico the development of a true natural gas pipeline network during the present administration is noteworthy, with the doubling of the network and an investment of around US$16bn, allowing for conventional power plants to be replaced with latest generation combined cycle plants. The opening of the market as a result of the energy reform is allowing private firms to participate in the supply of natural gas at very competitive prices, and for new combined cycle plants to be developed.

With regards to renewables, the three clean energy power auctions in Mexico have brought surprising results, with very competitive generation prices for wind and solar. Without a doubt, Mexico is shifting its energy matrix to become more sustainable, efficient and modern.

In Chile, project development is oriented more toward solar plants, given that the country's north has the best conditions in the world for the development of solar. Although the only solar thermal project in construction is Atacama I, the government, through its strategic solar program, is encouraging the development of the 'solar district' initiative. While recent auctions have resulted in low prices, the development of complementary services regulation will allow for profitable fixed-power and storage, which could pave the way for the entry of more solar thermal projects, and which would fit into the Energía 2050 plan that aims to achieve 70% of renewable generation by that date.

BNamericas: Solar seems poised to see strong growth in the coming years, judging by the role it has played in auctions in Latin America.

Gabellieri: For sure. Renewable energy will continue to grow, particularly solar, both solar thermal and solar photovoltaic. Renewable energy is the future. But at the same time we also see gas as the energy of transition between carbon and renewables, a period that we believe will last some 25 years.

BNamericas: Has this surge in solar changed Sener's strategy in any way?

Gabellieri: Sener has always bet on solar, and is a technological leader in this field. The surge of solar simply reaffirms our outlook and incentivizes us to continue developing innovative technological solutions to optimize costs and benefits.

BNamericas: And what about the role of liquefied natural gas (LNG) in Latin America?

Gabellieri: As with solar, Sener is also a leader in the construction of regasification plants, and we think LNG will play a significant role in Latin America and we are prepared for that business, both onshore and offshore.

BNamericas: Could we see a project on the scale of Morocco's NOORo in Latin America?

Gabellieri: Yes, from a technical point of view it would make sense in a country such as Chile, which has the best irradiation conditions in the world in the Atacama desert, and where a complex like NOORo could be built. However, governments, the costs of generation technologies and the needs due to demand must all play a part to make such a project viable. It's a complex process, and generally slow, for such opportunities to become a reality.

BNamericas: Does Sener plan to participate in auctions in Latin America this year?

Gabellieri: Yes, the company's renewables, power and oil and gas segment anticipates an intense year of contract activity.

BNamericas:​ Do you see Mexico's energy reform being affected by the renegotiation of the North American Free Trade Agreement or by the July presidential election?

Gabellieri: Mexico's energy reform is a constitutional reform, so the country will know how to adapt to new local and international situations, but without losing sight of why the reform was introduced and approved.

About Luis Gabellieri

Luis Gabellieri has been director of Sener's gas and thermal energy department since 2001 at the company's Madrid headquarters. He holds a postgraduate degree in arbitration from Pontificia Universidad Católica Argentina.

About the company

Sener is a private engineering and technology group founded in Spain in 1956 and offers specialized technological solutions to the energy, environment and aeronautics industries.