IKI Alliance, Author at CLIMATE.BLUE

By 2030, there will be an increase in both the population and tourists in San Miguel de Allende (Guanajuato), which is why it is estimated that the costs of water provision will increase by at least 25% compared to today.

However, the question is, will there be enough drinking water to meet basic needs? According to Conagua studies, the aquifers that provide water to this world heritage city are already overexploited. Shortly, climate change scenarios estimate a decrease in rainfall throughout most of the year, which could affect the replenishment of the aquifer by up to 14%.

This indicates that, in a trend scenario, a Zero Day will arrive, as was the case in Cape Town (South Africa). At that point, the replenishment of the aquifer will be less than what is being extracted, and there will not be enough water for the population, meaning extreme actions would have to be taken.

To avoid this, the municipal government of San Miguel de Allende launched the Climate Change Assistance Program last month, starting in the communal lands of Doña Juana and San Agustín González. They have been the first to initiate the restoration of forests and soils in 83 semi-desert hectares, through the reforestation of 19,000 native plants and the construction of hand-made dams using stones and meshes.

Likewise, the rightsholders of the communal lands owners of El Salitre and Los Torres have begun preparations for the rehabilitation of soils on 550 hectares of land, as part of the Payment for Environmental Services agreement signed between the municipal government, the beneficiary communal lands, and the National Forestry Commission (Conafor).

These ecosystem-based adaptation measures aim to reduce the risk of water scarcity and soil erosion in the municipality and, in the short term, create temporary jobs for the people of San Miguel, in the face of the crisis caused by COVID-19.

The program is led by the municipal government of San Miguel de Allende with financing and cooperation from various actors, including a developer in the real estate-tourism sector, representatives of the communal lands of San Agustín González, Doña Juana, Los Torres, and El Salitre, Conafor, and technical advice from the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, as well as from civil society organizations Salvemos al río Laja, GAIA, Guanajuato Conservation Corps and Vía Orgánica.

We know that the multiple challenges of cities can no longer be seen in isolation or addressed from a sectoral perspective and that, to solve inequalities and the multiple dimensions of social backwardness, it is necessary to include topics such as:

The right to the city
The right to a healthy environment
Gender mainstreaming
The implementation of actions that can promote greater resilience to the climate and health emergency

Strong coordination is required between different sectors and levels of government to carry out actions around strategic issues for sustainable development in cities.

It is in this context, and, knowing that Mexico has national goals for the reduction of greenhouse gas emissions and vulnerability, that the union of efforts between institutions to achieve common goals makes so much sense.

Therefore, the Ministry of Environment and Natural Resources (SEMARNAT), the Ministry of Agricultural, Territorial and Urban Development (SEDATU) and the Mexican Association of Municipal Planning Institutes (AMIMP) with the support of projects on Climate Protection in Mexican Urban Policy (CiClim), the Mexican-German Climate Change Alliance and the Climate Policy Meets Urban Development Project, which is part of the International Climate Initiative (IKI) at Germany’s Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU), have identified the challenges and solutions that some Mexican cities are giving to climate change issues.

From June 2020 to February 2020, these institutions are opening exchange spaces for webinars and online Support Groups for Climate Action (GAAD) between various sectors of the different orders of governments in Mexico, Latin America, and Germany.

You can find the calendar of activities at https://bit.ly/3hO6yPA (in Spanish)

You will find the results of each of the 12 schedules interventions, conforming a reservoir of learning and information on the different topics covered: green infrastructure, sustainable mobility, densification, and green belts, among others.

Webinar 1: June 17, 2020 – Integrative System of Social and Environmental Aspects in Urban Planning + Good Mobility Practices.

Grupo de Apoyo para la Acción Climática (GADD 1): June 10, 2020 – Green Infrastructure.

Webinar 2: July 16, 2020 – Inclusive Streets in Mexico and 4S Mobility

Webinar 3: August 18, 2020 – Green Infrastructure: The same in the North as in the South?

Grupo de Apoyo para la Acción Climática (GADD 2): August 20, 2020 Movilidad – Urban Sustainability “Plan de Movilidad 4S”

More than half of the world’s population lives in cities, and this number is set to increase to more than two thirds by 2030. Cities are responsible for approximately 70% of greenhouse gas (GHG) emissions.

Climate change requires the implementation of actions on a local level since global agreements are not enough in this fight. Thus, mainstreaming climate change and urban planning will promote a transition to neutral cities adapted to climate impacts, as well as contributing to compliance with the Paris Agreement and the 2030 Agenda.

For these reasons, the Ministry of Environment and Natural Resources (SEMARNAT), the Mexican Association of Municipal Planning Institutes (AMIMP), with the support of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH through the Mexican-German Climate Change Alliance project, launched an online survey from April 20 to May 29, 2020.

Credits: GIZ. Presentation of results of the survey “Climate Change and its Impacts on Municipal Planning”

The results of the survey “Climate Change and its Impacts on Municipal Planning” were presented on June 8, 2020. The survey collected information from 35 Municipal Planning Institutes (IMPLANES) located in different parts of the country, thus realizing a complete view of the entire territory. The main climate risks detected in the areas of incidence are:

Furthermore, it was possible to identify 95 projects that are in different stages of implementation in the urban-rural sector, the main themes being:

It is important to note that despite the barriers faced by IMPLANES (for example, a lack of budget and the change of priorities in the administration), they have managed to make gradual progress in the implementation of their projects, with positive impacts in environmental, economic, and social aspects.

Credits: GIZ. Projects developed by IMPLANES and their stages.

Finally, they have detected their initiatives’ contributions to the fulfillment of the Sustainable Development Goals, especially SDG 11. Sustainable Cities and Communities, 13. Climate Action and 3. Well-being and Health.

The next step is mapping and working with different actors to allow for articulation between sub-national governments through the exchange of experiences. To facilitate this, monthly webinars and Digital Support Groups for Climate Action (GAAD) are being held bi-monthly from June to February 2021.

You can download the presentation and the webinar review to see the results in detail (in Spanish)!

The crisis resulting from the spread of COVID-19 implies a challenge on a global scale. Economic projections already indicate a decline in different regions around the world, with particular vulnerability for Latin America.

In this adverse context, different spaces are being opened for dialog and debate, to generate agreements that can guide the economic and social recovery along a sustainable path.

In order to foster these spaces for exchange, the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH accompanied WRI Mexico in the initiative “Sustainable Revolution: Dialogues for Recovery, Resilience, and Equity”. Other accompanying allies include the World Wildlife Fund (WWF), the Inter-American Development Bank (IDB), the Climate Initiative of Mexico (ICM), and the Economic Commission for Latin America and the Caribbean (ECLAC). Every week between June 9 and July 15, the initiative has a different thematic focus (such as cities, mobility, forests, energy, and green financing), offering a space for an exchange through high-level panels, multi-stakeholder tables, and webinars.

Credits: WRI Mexico. Schedule of sessions of the initiative “Sustainable Revolution: Dialogues for Recovery, Resilience, and Equity”.

At the opening event on June 9, the WRI executive director, Adriana Lobo, announced that a roadmap will be published at the end of the work sessions, with inclusive solutions for all sectors of society.

‘The objective of this initiative is to activate multisectoral dialog to identify priority issues and possible agreed lines of a solution, through a digital offering of top-level panels, talks, and sector tables, which allow us to position and promote processes to transit to environmentally friendly, resilient, and equitable economies.’ – Adriana Lobo, Executive Director of WWF.

From GIZ Mexico, the importance of the climate crisis and the need to join efforts to reconcile the economic with the environmental agenda was emphasized. Also, the following areas of collaboration were anticipated: resilient cities, mobility, energy, biodiversity, green financing, and collaboration with sub-national governments.

‘At GIZ, we want to contribute to these issues, and we are also very willing to listen and learn from our partners, as well as participants. It is important to come up with an overview that can guide Mexico’s green recovery’ – Dennis Quennet, director of GIZ’s Cities, Transport and Industry programs.

In the first prestigious panel, which took place following the inauguration, reflections were shared on the global challenge implied by the current economic, social, and environmental crisis. From the Mexican Ministry of Foreign Affairs, Martha Delgado Peralta, Under-Secretary for Multilateral Affairs and Human Rights, stressed the importance of linking gender issues to environmental issues and focusing on the well-being of communities in the recovery from the crisis.

Then ECLAC’s executive secretary, Alicia Bárcena, highlighted how the crisis caused by COVID-19 has revealed a series of structural problems in the current economic model in Latin America today. She stated: ‘We must prioritize sectors with great impetus for sustainability: clean energy, development of the links between water/soil / biodiversity, digital connectivity and electric public transport, health and mobility infrastructure, and the care economy’

Credits: WRI México / CEPAL. Structural problems in Latin America.

The second high-level panel of the conference focused on the specific challenges faced by Latin America in this context. Within this framework, Iván González Márquez, from the Mexican Ministry of Environment and Natural Resources (SEMARNAT), stressed the need to tackle the climate crisis with concrete measures. He explained that a holistic transition model is being proposed by the dependency, involving not only the government but also sectors of civil society. It includes seven environmental transitions: forest, agroecological and fishing, water, energy, biocultural, urban-industrial, educational and citizen-based, and environmental justice and governance.

At the end of each panel, there was an opening for questions from the public, with citizen participation encouraged. To review the agenda for the coming weeks, you can consult the official website of WRI Mexico. The next online event will take place on June 15 within the framework of Cities Week, with the theme: “Urban Inequality and Air Quality during the Pandemic: Emerging Social and Economic Challenges.”

In the current health crisis we are experiencing, the environmental issue has become important and deserves to be placed at the center of the public health discussion. In fact, various Natural Science research institutes have pointed out that this crisis had its origin in the interruption of the delicate environmental balance. Factors such as habitat destruction, capture, trafficking and consumption of wildlife have represented favorable conditions for the SAR-CoV-2 virus to become contagious to humans. This is why today, more than ever, the protection of natural resources and the environment is crucial.

For this reason, it is important to ask ourselves: What will happen after the pandemic? What will be our role in this return to a “new normal”? What are our alternatives? How can we identify these measures or solutions? Which actors should be added? Which communication strategies should be promoted at a territorial level?

We must acknowledge that the main cause of the spread of this disease is the poor relationship that humans have established with the environment. Therefore, we have to generate a new, more harmonious relationship between society and nature. This is the only way to avoid similar situations: not only those associated with health problems, such as the emergence of new epidemics and their escalation towards pandemics, but other phenomena that have been documented with scientific evidence, such as the loss of biodiversity, climate change, water loss, and the reduction of plant cover and soil erosion, could lead us to critical situations for humanity.

Credits: Shutterstock. The increase in domesticated animals for human consumption has a large impact on ecosystems.

One of the most relevant causes is the change in land use, explained by the increase in extractive and productive activities, deforestation, and the expansion of urban areas. Another relevant factor is the increase in the proportion of domesticated fauna (for example, cattle, pigs, and poultry) in recent centuries as food for human consumption, alongside a detriment in the proportion of wild fauna. Consequently, this combination of elements has expanded the universe of pathogens associated with domesticated fauna, specifically viruses, bacteria, fungi, parasites, prions or misfolded proteins. These pathogens play a role, and ecosystems, both terrestrial and marine, depend on their activity. For example, plants and animals release residues into the soil (carbon, nitrogen and sulfate, among others) that, when degraded, are used by bacteria as food. Thus, it is important that anthropogenic activities – and the different sectors involved in the environment – become aware of this and act responsibly, maintaining the natural balance.

For these reasons, the Nationally Determined Contributions (NDC) presented in 2015 by the Government of Mexico, and now in 2020, subjected to a review and update process, should identify concrete actions, opportunities, and needs, taking into account the value of natural resources, ecosystems, and their services to human and planetary health that provide the means for their implementation at different scales in the country.

Throughout 2019, areas for improvement were identified in the socio-economic evaluation of Comprehensive Urban Solid Waste Management (MSW) projects, in particular the methodologies carried out by the Center for Studies for the Preparation and Socioeconomic Evaluation of Projects (CEPEP) and the Financing Energy for Low-Carbon Investment – Cities Advisory Facility (FELICITY) of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, with the support from the PIAPPEM consultancy. These methodologies will help the municipalities in decision-making for the implementation of projects.

In November, CEPEP and FELICITY co-organized very enriching spaces for the exchange of experiences for all participants, with an atmosphere of dialogue and shared experiences to strengthen the capacities of the sector.

Credits: Itzel Alcerreca. Interventions by the Head of the SHCP Investment Unit, Jorge Nuño Lara (left) and Helge Arends, Director of the GIZ Agenda 2030 Program (right).

On November 19, the first Technical Meeting was held on project preparation and evaluation; the event was co-organized by CEPEP and FELICITY. Jorge Nuño Lara, Head of the Investment Unit of the SHCP and Helge Arends, Director of the GIZ Agenda 2030 Program, participated in the event.

Presentations topics included:

National financing strategies, examples of sub-national cases, as well as the challenges and quantities of non-recoverable support that PRORESOL can contribute to infrastructure projects for Comprehensive MSW Management; given by Carlos Puente; Director of Energy, Environment and Water at FONADIN
International Presentations: Chile, represented by Eduardo Contreras, specialist in project evaluation at the University of Chile, who highlighted the value of multi-criteria analysis as a tool to locate and evaluate costs; and William Maroto, representative of Costa Rica, who presented us with success stories from MSW Comprehensive Management projects in the Oreamuno municipality of Costa Rica.

Credits: Itzel Alcerreca. Sharing Experiences at a Sub-national Level in Mexico (above) and Costa Rica (below).

Seventy people attended, 40% of them women. The attendees came from different sectors: financial, technical and project promoters, with national and international experience in project preparation, management, and evaluation.

Credits: Felicity. Collaborative distribution of the event participants.

As part of raising awareness of RSU management, on November 20, a brief exchange was held between internal SHCP personnel to identify the main challenges and areas for improvement in project preparation.

Credits: Itzel Alcerreca. Sharing challenges and areas for improvement with different areas of SHCP

Event information can be found here and presentations are available at the following link.

The project “Convergence of Energy and Climate Change Policy in Mexico” (CONECC) seeks to build bridges between the energy and climate sectors in order to facilitate the achievement of global and national climate goals. The scope of these commitments requires a strong impetus to technological change, which is why CONECC, in coordination with the Querétaro Sustainable Development Secretariat (SEDESU) and the company LiCore, began the process of forming the Querétaro Hub of Technological Innovation in February 2020.

The Hub is a linking platform that seeks to promote the development and implementation of innovations that can accelerate the energy transition and green competitiveness of Querétaro’s productive sector. Given its pioneering characteristic in the region, the experience is expected to serve as a model for various public-private collaboration efforts for climate technology development in other states.

Likewise, the Hub seeks to strengthen collaboration in the area of innovation and entrepreneurship in Querétaro, which includes start-ups, SMEs, large and corporate companies, public institutions, and academia. In March 2020, a Working Group was set up to form the Hub, made up of representatives from the state’s innovation and entrepreneurship sectors. The Working Group will discuss governance and financial sustainability mechanisms, as well as identify projects to start the Hub’s operations.

Credits: CONECC / GIZ. Technology Innovation Hub Working Group Meeting

During the Working Group’s first meeting at the facilities of the “Nuqleo” entrepreneurship area in Querétaro, the process of legal incorporation of the Hub and the prioritization of strategic services and lines of action were analyzed; some of them include:

Acceleration and promotion of disruptive technologies and business models.
Advice, training, and certification for startups and SMEs.
Access to innovation laboratories (sandbox formats) or similar. A sandbox guides the development of new technologies or business models in a testing environment that takes into account the regulation and/or applicable legislation, mainly promoting innovation in the field of digitalization of the electricity sector.

Credits: CONECC / GIZ. Actors in the innovation ecosystem discuss priority lines of action for the Hub

The CONECC project will provide technical support in the process of forming the Hub. The aim is to have the technical opinion of an expert team to create linkage platforms and technological innovation and establish a coordination office for the Hub based in Querétaro. A communication strategy will also be elaborated for the socialization and dissemination of the Hub on local and national levels.

The Working Group plans to work on the selection of specific projects that, through a strategic action plan, allow successful integration of start-ups and SMEs in the innovation environment. The selected projects are expected to receive (1) consultancies to align their proposals to the main issues facing the state energy sector and, (2) support in development and implementation processes, through methodologies such as design thinking or sandboxes. Mentoring, access to specialized testing laboratories, commercial feasibility analysis, links to financing, and interrelation with national and international companies and experiences are included, among others.

Credits: CONECC / GIZ. 1st Session of the Working Group

The creation of a technological innovation hub in Querétaro is essential for sustainable economic recovery. This collaboration model fosters innovative technologies and business models in the field of renewable energy and energy efficiency. Coordinated action between the state innovation area and entrepreneurship is strengthening economic competitiveness and accelerating the implementation of low-carbon technologies. More information coming soon.

All images are from workshops carried out prior to the COVID-19 health emergency. Currently, meetings and work sessions are held in virtual format.

On May 14, the first webinar on climate change was held in Chiapas: “Economic Effects Resulting From the COVID-19 Contingency in Chiapas“. This meeting was organized by the State Advisory Council on Climate Change, as part of the efforts to reflect on the economic impacts that we are facing as a society in the face of the current health emergency.

The webinar involved four speakers from different sectors, who focused their presentations on two relevant aspects. On the one hand, they shared the geographical context and the unequal ways in which the local Chiapas communities are facing the contingency. On the other, they highlighted the importance of not seeing economic problems according to sector, but rather with a bigger vision that links to the national perspective, to enable dialogue and find new ways of working in the post-pandemic stage.

The productive sector also participated through the Ministry of the Board of Directors of the Mexican Milk Federation, who stated: “We need, more than ever, to turn sustainable livestock farming into a public policy that guarantees the participation of producers, technical agents, and NGOs in tune with our governments, in order to face the vulnerability in which the productive sector finds itself. ”

The government sector was represented by the Ministry of Environment, Energy and Sustainable Development of Oaxaca, which, from its experience as a member of the GCF Task Force (GCF TF), stated that there are great challenges facing indigenous peoples of Latin America in the face of this sanitary and climatic emergency; thus, the GCF TF is proposing a work route from the instances at the international level to face uncertainties regarding the increase in forest destruction.

As part of the transition to the project “Development of a regional system to monitor biodiversity and climate change – Selva Maya” that will be concluding shortly, Pronatura Sur will be taking up the achievements of the strategy built by the the GCF TF.

The aim of the GCF TF is to guarantee the permanence of forests and the livelihoods of their inhabitants, so efforts will focus on reducing environmental and social risks during the post-COVID-19 economic reactivation. The pressure on land and the risks of deforestation will increase exponentially if there are no economic alternatives for the most vulnerable groups, such as indigenous and rural communities, and the floating population, which has experienced unemployment during the pandemic. Thus, this initiative will be focusing its efforts on modifying existing strategies and developing new ones that allow it to support its member states – such as the state of Chiapas – during economic recovery, mainly in the forestry sector.

The recording of the webinar is available here.

People’s wellbeing depends, among other things, on environmental conditions. Poor air quality can increase the risk of respiratory complications during diseases such as COVID-19. Air quality monitoring facilitates risk assessment and public policy decision-making.

The forest fires and agricultural burning that take place in many regions – including the Mayan Forest – generate harmful particles, visible as black smoke, which affect human health. The respiratory problems caused by these particles are an aggravating factor for people who are fighting against the disease caused by the novel coronavirus type 2, better known as COVID-19, which is ending the lives of many people.

Credits: César Paz – WCS Guatemala. Fire in the Mayan Forest

To assess the risk level that air pollution means for human health, it is important to have access to reliable data. For this reason, the project Development of a Regional System to monitor biodiversity and climate change – Selva Maya, financed by the Germany’s Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) within the framework of its International Climate Initiative (IKI), supports various actors in the Mayan Forest region in monitoring air quality.

For this, the project supported the acquisition of PurpleAir sensors that were installed in different regions of the Mayan Forest, covering areas in Guatemala, Belize and Mexico. These sensors detect air particles, and the levels are available publicly and in real time on the Internet.

Credits: GIZ / Ameyalli Nares. An Aire PurpleAir Quality Sensor

This data has already been used to improve the living conditions of many people. After confirming a dangerous air quality level during a fire at the San Benito landfill, Guatemala, the municipality began the process for better solid waste management. In Belize, data concerning agricultural burning inspired a social media campaign. Consequently, the Belize government passed a law that prohibited burning during the COVID-19 contingency.

Due to these successful experiences, actors in Guatemala, Belize and also Mexico want to expand the network of air quality sensors. This will allow faster detection and reaction to threats to human respiratory health. Together with other measures, this approach will help the population and decision-makers of the three countries to cope with the COVID-19 pandemic and possible similar epidemics in the future.

Contact: claudia.nares@giz.de

More information at:

Selva maya, devorada por las llamas – La Jornada (in Spanish)

Purple Air

Alarma por mala calidad del aire en Petén, un factor de riesgo para la población ante el covid-19

This morning the particle sensor recorded record smoke in the Belmopan air. The air is nearly un-breathable. See: https://www.purpleair.com

Gepostet von Jan Meerman am Freitag, 17. April 2020

Due to the COVID-19 outbreak, the priorities for attention to the health emergency have been markedly reduced. Government efforts have also been redirected to protecting citizens and fighting against the health epidemic.

In an adjustment process, the municipalities’ focal points, national development banks, and federal ministries (Ministry of Agricultural, Territorial and Urban Development – SEDATU, Ministry of Environment and Natural Resources – SEMARNAT, Secretary of Treasury and Public Credit – SHCP) have continued preparing their projects.

With the support of FELICITY and key actors, the migration of face-to-face project preparation courses to digital workshops has been encouraged, so that sub-national public officials can continue their great efforts in the development of technical, financial, environmental, technological and social capacities.

Project promoters have also collaborated through platforms that facilitate training and remote communication for project preparation. Progress is being made in technical assistance from the cabinet, to prepare the procurement process and have the documentation required for the continuation of the project cycle.

A healthy collaboration between the parties involved has allowed the adjustment towards the implementation of the projects; however, the main challenges in the current context of COVID-19 increase the pressure on urban budgets.

Green recovery represents a potential opportunity to reduce budget spending by saving energy costs, but also to generate more quality jobs and mitigate greenhouse gas emissions. The continuity of these projects is particularly important in the current context of a health crisis that seeks economic recovery in the short term and green recovery in the medium term.

The current coronavirus pandemic can be used as an opportunity to adapt and better prepare our cities to deal with current and future climate and health challenges. The app Árbol IoT helps cities to better plan and manage urban trees. This can help to avoid high temperatures, to buffer the impacts of flood events, and to mitigate socioeconomic-related health inequalities, among others.

Árbol IoT or Internet de los Árboles (IoTrees or the Internet of Trees in English) is a platform to engage citizens in urban tree mapping and environmental monitoring. Ideated and developed in the City of Guadalajara, Mexico, it aims to empower citizen advocacy and support municipal urban tree management to improve the greenery in the city. Thus contributing to ameliorate high temperatures and to buffer the impacts of flood events. The platform seeks to crowdsource an easy-to-update urban tree inventory, visualize and quantify the ecological benefits of trees and assist in public decision-making based on data and evidence.

Árbol IoT is a cross-platform composed of a mobile and web app, and a network of low-cost sensors that allows citizens to monitor the pollutants suspended in the environment, weather and noise on a street scale. The platform encourages engagement with green gamification and enables participation of a wide range of the population, including the elderly. It fosters inclusion through a mobile interactive table that can be placed in public spaces and used on-site by citizens who don’t have access to digital technology. A light feature within the mobile app allows citizens with limited or no mobile data on their devices to map and capture information offline and to upload it later when WiFi is available.

MuCitySavior, AylluDamos and Árbol IoT, the open-source digital solutions of the Global Program “ICT-based Adaptation to Climate Change in Cities” are developed, in use and have already been transferred and scaled up in India, Peru and Mexico, respectively. The three digital solutions have been applied to the #SmartDevelopmentHack in order to remark the critical importance of a green recovery. The current coronavirus pandemic is a good opportunity to adapt and better prepare our cities to deal with current and future health challenges

Thus, Árbol IoT joined the #SmartDevelopmentHack as a digital solution to help cities plan and manage an evenly spatial distribution of urban trees to mitigate socioeconomic-related health inequalities. Urban trees can help clean the air, and air pollution is closely associated to health problems such as asthma, high blood pressure, and diabetes, all of which are believed to pose a high risk to COVID-19 patients. Previous pandemics such as the plague, tuberculosis and cholera proved to transform cities by putting pressure into increasing greenery. For example, the design and construction of Central Park and many other parks in the 1800s was justified by the need of green areas to clean the air.

Distributed Generation is an adequate mechanism to impulse cost reduction in companies and organizations while avoiding emitting greenhouse gases into the environment. It is an important strategy to mitigate the economic impacts of COVID-19, and one of the main challenges is to find financing mechanisms that can accelerate the execution of these projects in the country. For this reason, LAB Mexico promoted the development of a workshop for the financing of Distributed Generation (DG) on November 13, 2019.

Currently, the photovoltaic DG has an installed capacity in Mexico of almost 1,000MWp, representing 1% of the capacity of the national electricity system, while the available capacity of the General Distribution Network is 27,000MWp. The DG will play a fundamental role in fulfilling energy transition goals by 2035.

There is a great opportunity to support companies – especially small and medium-sized enterprises – with renewable energy strategies that reduce their energy costs, permitting the recovery of their post-COVID-19 economies.

The conclusions, based on the analysis of the discussions carried out among participants during the workshop, will serve as a guide for establishing the monitoring and intervention plan (roadmap) with key stakeholders in the industry.

The DG sector is not robust enough to finance this transformation alone. Commercial banking in Mexico is a solid sector with reserves, capacities and scope that can facilitate this transition.

However, both industries are required to work together on the following aspects:

The promotion of the benefits of photovoltaic DG must be strengthened in the SME sector to increase financing demands for this type of project. This promotion should be a joint effort between relevant business associations, development finance institutions, and local and federal governments.
Revolving credit lines must be implemented for companies integrating DG in order to facilitate DG growth and consolidation.
Other financing instruments, such as leasing and energy purchase contracts, must be promoted as alternatives to conventional credit, both in supply and demand.
A certain and stable regulatory environment must be promoted to facilitate the investment of risk capital with different business models and financing, and with the capacity to replicate and scale. This is the work of the photovoltaic industry, alongside development and commercial financial institutions, as well as local governments.
Information that allows financial institutions to better assess risks and generate products according to the risk profile of the projects must be generated on the market and performance of DG projects.
Financial institutions require a greater technical understanding of the value propositions of PV systems, their operational risks and shelf life.
Various financial intermediation schemes should be explored with the support of “asset managers” that facilitate project evaluation, risk determination, dispersion of financing and collection responsibility.

As a product of this IDB workshop, ABM and GIZ, together with NAFIN, encouraged the hiring of a consultant to provide material for this roadmap, which will be delivered at the end of June and will be disseminated through the IDB, ABM, GIZ and IKI.

The workshop materials can be found here.

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