in total revenue in 2020
came from MasTec’s renewable energy infrastructure business
of Electrical Transmission
45% of MasTec’s electrical transmission business went toward enhancing the reliability of transmission lines
The Path to Drawdown: Grid Expansion
A massive scaling of emissions-free energy sources is needed to solve climate change. And thankfully, renewable sources like solar and wind are quickly expanding their capacity worldwide. But to reliably provide renewable energy to every household and organization in the world, we need a power grid that’s much bigger and more flexible.
The power grid is the dynamic network of electricity generation, transmission, storage, and consumption that 85% of the world relies on. But its initial design for constant, centralized power production is not conducive to the intermittency of solar and wind power. For the world’s electricity supply to become completely renewable, the power grid needs to become more adaptable than it is today. Many technologies - constant renewables like geothermal and nuclear, utility-scale energy storage systems, batteries, and smart appliances - contribute to grid flexibility.
The power grid also needs to expand to support a renewable transition. Where the grid spans larger geographies and more electricity sources, it can even out the total output and variability of renewables. Electricity generated in Texas during the summer can then be used to power houses in snowy Chicago during the winter. To achieve this scale, the IEA estimates that, between 2020 and 2030, around 16 million km of distribution and transmission lines need to be built, an increase of 80% compared with the past decade.
MasTec, Inc. (stock ticker: MTZ) engineers, builds, installs, maintains, and upgrades infrastructures. They primarily serve customers in the utility, communications and government industries. MasTec’s headquarters are located in Coral Gables, Florida.
MTZ's Role in Drawdown
MasTec contributes to the Drawdown solutions of grid flexibility and grid expansion through several of their business segments.
Through their Electrical Transmission segment, they build the infrastructure that connects the US power generation to consumers. They work with their customers to design and build innovative, smart energy solutions, including modernizing overstressed sections of the electric grid with insufficient capacity, and upgrading aging electric infrastructure. They also build and maintain high voltage electric power transmission systems, substations, switchyards and distribution systems.
Through their Clean Energy and Infrastructure segment, MasTec is one of the largest renewables contractors in North America. They provide engineering, procurement, and construction services and project management solutions to the power market including renewable energy power sources. As of the end of 2020, their Clean Energy and Infrastructure segment accounted for about 25% of their total revenue.
MTZ: What We Like
As one of their growth strategies, MasTec has a track record (p. 63-64) of acquiring companies to expand their grid flexibility/expansion operations as well as their capacity to build new renewable energy facilities:
- In 2019 MasTec completed the acquisition of a company specializing in construction projects in the power industry
- They acquired a wind turbine services company in 2018