Learn how Enerlogix can help you reach your environmental, social, governance objectives and provide you with GHG reporting and accounting standards.
Learn more
Successful results – Clients in the MEM.
One of the main activities within the scope of Plan 360 Management is Energy Procurement.
The proper execution of a supply agreement as well as the successful performance of the contracted products require thorough work, a proactive approach, and the capacity to adapt.
Prior to executing a supply agreement, companies should have a strategy in place and the proper understanding of the product to be contracted. Enerlogix assists its clients in understanding the different options available and assess the possible risks of each offer.
Sometimes after the execution of the supply agreement, commodities/energy prices change affecting the performance of the contracted products. Other times, companies may need to review their energy consumption and look for ways to mitigate risk and protect their budgets.
As part of our Plan 360 services, Enerlogix monitors the performance of each of its clients and takes a proactive approach in identifying the cause of what may be affecting the performance and savings of each load center and assess a viable solution.
The following are examples of some of our clients who have achieved successful results in the MEM.
Case 1 – Mining Company
This load center, located in the North distribution region, is connected to 115kV which is considered a sub-transmission user. Its annual consumption is around 130 GWh with an 80% Load Factor.
The contracted product allows the user to modify the nominated hourly consumption one week in advance and provides a specific tolerance band. When consumption patterns are stable, the product has a medium-to-low propensity to risk. The product is subject to inflationary adjustments (Energy, Capacity and Clean Energy Certificates (CELs)) avoiding the risk for SPOT market transactions.
This client managed to save up to 23% when compared to its corresponding basic service rates month by month. The estimated rate during this timeframe was $1,481 MXN/MWh.
Case 2 – Medical Devices Manufacturer
This load center, located in CFE’s North-Gulf Division, has an annual consumption around 2,000 MWh. Due to its variability in monthly consumption, its Load Factor is 60%.
This load center, which does not exceed 1MW of demand, has delivered total savings of $1,986,061 MXN ($99,303 USD) estimated around 25%. In fact, throughout the life of the contract, monthly savings of up to 31.18% were achieved when comparing the supplier’s rate against basic service.
Under its supply agreement, the user can set its expected energy consumption monthly. This allows for better control over the expected rate risk. Energy price per MWh varies no more than 2% which contributes to better budget certainty. Given the variability in monthly consumption, this product is considered low risk.
Case 3 – Appliance Motors Manufacturer
This is facility, located in north-eastern Mexico and is connected to high-tension (115kV). It has an annual consumption of 23,000 MWh and a Load Factor of 75%.
This client contracted a Heat Rate product. Due to the elevated risk associated to natural gas market prices, these types of products must be managed via financial hedges. Enerlogix assisted the client in determining and fixing its energy and capacity blocks, enabling it to determine the spot market exposure and its appetite for risk.
In one year, this load center achieved savings of $8.8 million MXN ($440 thousand USD) equivalent to 21% savings against CFE’s Basic Service Supply.
Case 4 – Appliances Manufacturer
This facility is located in the North-Gulf region and is connected to high-tension. Its current annual consumption is 33,000 MWh. Its Load Factor is around 65%.
This client contracted a Heat-Rate product, which as mentioned on the previous case is an elevated-risk product. However, Natural Gas prices were very competitive, and the client took advantage of this opportunity. During the contracted term, the supplier’s weighted tariff for the client was $1,383 MXN/MWh, delivering savings around 27%. This translates to around $17 million MXN, equivalent to $850,000 dollars.
Case 5 – Electronic Instruments Manufacturer
This load center, located in CFE Distribution’s North-Gulf Division, has an annual consumption of 9,000 MWh and an 80% Load Factor.
This facility secured a low-risk supply agreement in which the contracted products (Energy, Capacity and CELs) are inflation-free. The retailer products costs are truly fixed for the life of the contract with no adjustments of any kind, delivering budget certainty. Given the characteristics of the load center’s energy consumption pattern, the client opted for an aggressive market strategy where 35-40% of its energy is purchased from the spot market. Following this strategy, the client was able to reach savings up to 34%. For the year, the electricity rate was estimated at $1,619 MXN/MWh resulting in $3.5 million MXN ($174,000 dollars) in savings, equivalent to 19% vs CFE’s Basic Service.
What is a Qualified User?
A Qualified User is a large-energy consumer with a peak demand of at least 1000 kW within a twelve-month period. This peak-demand threshold may be achieved by one or multiple facilities. To participate in the MEM, a Qualified User Registration process must be carried out and approved by the Energy Regulatory Commission (CRE). Enerlogix will assists its clients in obtaining Qualified User Registration status.
I am already a Qualified User, Could I go back to being a Basic Service User?
Yes. Any Qualified User may go back to Basic Service User status but only after mandatory 3-year term in the MEM. However, if the Qualified User exits the MEM, it must remain outside the deregulated market for at least 3 years before it is eligible to regain Qualified User status.
What is your experience in Mexico?
Enerlogix began operating in Mexico since 2014, right after the energy reform was approved.
Enerlogix has positioned itself as the leading energy consultant in Mexico’s Wholesale Electricity Market with both market regulators as well as Qualified Service Retailers.
Not only does Enerlogix have access to regulators and market participants, it also takes an active role in the organization of events. In such events, Enerlogix has had the leaders of SENER, CRE and CENACE participate in its panels at home and abroad.
Enerlogix has developed excellent rapport with regulators and market participants.
Feel free to give us a call. We will gladly explain how we can provide value added solutions for your energy needs.
Who are your clients in Mexico?
Currently, our pipeline includes companies from all industries: automotive, food/beverage, data/tech, industrial parks, manufacturing, services, leisure and travel, construction, logistics, mining, etc.
What is the MEM?
The 2014 energy reform gave place to Mexico’s deregulated market or MEM. Only large-energy consumers who are certified as a Qualified User may participate. Electricity in the MEM is supplied by Qualified Retailers.
Will Enerlogix consultancy maximize my company’s benefit through the MEM?
Yes. Enerlogix Plan 360 Management focuses on a client’s specific energy needs and consumption behavior, allowing each client to focus their expertise on its core business activities while Enerlogix analyzes the energy profile and searches, reviews and customizes the best options to procure electricity. Enerlogix will help your company with the following:
How long does the process take to migrate my facilities to the MEM?
Typically, migrating from CFE Basic Service to the MEM takes between 8 to 10 months. An action plan must be put in place to identify all the steps throughout the process. Enerlogix will assist you by scheduling the activities required so that your facilities may transition into the deregulated market.
Is my facility allowed to have both a MEM contract and a Self-Supply contract for one load center at once?
No. Self-Supply and the MEM belong to different regimes and do not co-exist. The same goes for CFE Basic Service and the MEM, either the load center remains a Basic Service User or it migrates to the MEM. In the MEM, the Qualified User will be supplied by a Qualified Service Retailer; this Retailer will represent the load center for all its electricity transactions in the market.
Whatever your current contracted condition, reach out to Enerlogix. Enerlogix will assist by analyzing your current situation and will suggest the best available option.
When in the MEM, will my company have to handle several invoices?
No. In the MEM, the Qualified Supplier is responsible for all the Qualified User power needs. Therefore, the Qualified Supplier will only issue one invoice to review and pay. Enerlogix will assist you by auditing your invoices monthly.
Once I migrate to the MEM, will my facility struggle with problems with the delivery of electricity? (transmission/distribution lines)
No, there is no difference. While CFE Transmission and CFE Distribution bear the CFE name, they are in fact different entities from CFE Basic Service. Whether you buy your electricity from CFE Basic Service or any other Qualified Supplier in the MEM, all electricity users in Mexico are clients of either CFE Distribution and/or CFE transmission. Thus, if any problems with the distribution/transmission lines took place, CFE Distribution/CFE Transmission would fix it and restore service to all users regardless of the Retailer supplying them.
When is the right time to migrate to the MEM and why?
Now is the perfect time to begin the Qualified User Registration. Basic Service users will be subject to higher prices, volatility, and uncertainty. Basic Service users are unable to negotiate prices or different products due to the Basic Service nature. Also, considering the rejection of Constitutional Reform on April 2022, the MEM is positioned as the safer bet for savings and budget certainty. Having Enerlogix as your advisor will allow your company to maximize those benefits.
What does Enerlogix do and how can you help my company?
Enerlogix is a neutral consulting company specializing in energy management services. Enerlogix helps manufacturing and other large industrial companies leverage the benefits of Mexico´s deregulated electricity and natural gas markets. The electricity deregulated market is called Wholesale Electricity Market. We will refer to the Wholesale Electricity Market as the MEM as it stands for Mercado Eléctrico Mayorista in Spanish.
Will Enerlogix consultancy maximize my company’s benefit through the MEM?
Yes. Enerlogix Plan 360 Management focuses on a client’s specific energy needs and consumption behavior, allowing each client to focus their expertise on its core business activities while Enerlogix analyzes the energy profile and searches, reviews and customizes the best options to procure electricity. Enerlogix will help your company with the following:
Does Enerlogix sell electricity or natural gas?
No, Enerlogix provides energy consulting services. However, Enerlogix will help you find suppliers of both electricity and natural gas.
Does Enerlogix represent energy suppliers / retailers?
No, Enerlogix only represents its clients and assists them in obtaining a greater understanding of their energy needs and negotiate favorable supply contracts to obtain savings, mitigate risks and achieve budget certainty.
Will Enerlogix bring my company the best offer?
Yes, Enerlogix will carefully review and analyze indicative prices / commercial offers and will prepare in depth analysis for your review. This information will simulate the performance of each commercial offer on your consumption behavior throughout time. Having this information will allow you to make an educated decision weighing budget and product performance.
How does Enerlogix identify key retailers?
For over seven years, Enerlogix has approached the different retailers participating in Mexico’s deregulated market with the sole purpose of identifying the key retailers with whom Enerlogix will organize procurement events for its clients. To date, CRE lists 40+ companies who are now Qualified Retailers or are in the process to become certified.
With so many options available, it is crucial for Enerlogix to learn about the retailer’s market experience, leadership team, generation, both own and/or secured, location of this generation, offered products, origination team, etc.
From this pool of retailers, Enerlogix has carefully selected those retailers that may represent our clients. All of these are world-class retailers with competitive products, prices, and services. Enerlogix would not bring its clients to retailers that are not up to par with the best of them.
