How has your experience in Latin America translated into results in Panama?
Cox Energy develops PV projects and invests in these projects while managing financial closing of long-term power purchase agreements (PPA). In Latam, we are present in Chile, Mexico, Panama, and Colombia. The company has a pipeline of 5,000MW in different renewable energy projects. Of this, more than 2,500MW are backed for the most part by long-term energy contracts, both public and private, while the other 2,500MW are in different stages of development and ready to go to tenders and sign future PPAs. We started in Chile because renewable energy was promoted there, and the government bet on auctions for renewable energy projects. So far, we have won two auctions: a 264-GW one in 2016 and a 140-GW one in 2017. At present, we can build almost 700MW of solar energy, the majority of which is produced under long-term contracts with almost all distributors. The auctions put the generators in contact with the marketers and distributors. In general, all countries provide enough support to face eventualities. Chile is one of the countries in Latin America where renewables have registered the greatest development. Its regulations are clear and specific, and it offers security to investors, generators, and distributors. Other countries should try to achieve a similar evolution.
Has the company evolved in Latin American markets?
We have consolidated our position in Spain, Mexico, and Chile. We are interested in all markets in Latin America, Central America, and the Caribbean. There are many opportunities, especially for solar energy because, in Latin America, the radiation from the sun is excellent and we must take advantage of it. Equally important, costs related to solar energy have been falling; just between 2014 and 2016 costs dropped by 70%. We have been in Panama since 2014 and have seen different ways to enter the market, which is a small energy market compared to other markets. In fact, in Central America, small projects are popular; for example, a 10-MW project is considered quite significant. In Panama, we have a pipeline of 150MW, and we are looking to close that with industrial clients. Other options are going to marketers or directly to spot, which is the market. Panama is heavily focused on hydroelectric energy, but there can be abrupt changes with the water supply, as has been the case in Colombia. It is important to have a reliable source of energy such as solar energy or wind energy. Panama enjoys abundant sunlight, which is why self-consumption is an interesting model here. However, people find it difficult to make the first investment, but we have different business models where we invest, and the customer pays over the years.
What are your targets and goals for 2019?
Our goal for 2019 is to build and put our plants into operation and develop new opportunities in Chile and Mexico. In Colombia, we want to do a PPA project and keep growing. At present, Panama is our entrance point to the Central American market, and we want to expand further. Our objective is to close a long-term contract and build a solar plant in a maximum period of one year. This is why we are focusing on industrial companies to start generating solar energy. Self-consumption is another interesting model and we want to grow that model in Panama and reach 150MW capacity. Panama will remain an attractive market as long as the government supports and maintains favorable policies. The regulations must support the development of projects, and the goals must be met. It would be interesting for the government to enact new tender processes for renewables and begin to forget about fossil fuels whose price fluctuates. We need an energy policy that will benefit the population and the country's competitiveness. I hope the new government will change this situation.