© AP
MEXICO-USA-ELECTRICITY
The plan of Mexico to favor state power plants and limit energy sales from private projects built by foreigners might hurt US investment in the country, officials said during bilateral talks this week.
According to statements issued on Friday, the US government has “real concerns regarding the possible negative impact” on US companies and investments.
“In each meeting we expressly convey the true concerns of the Biden-Harris administration regarding the possible negative impact of the energy reforms proposed by Mexico on US private investment in Mexico,” according to a statement from the US Secretary of Energy, Jennifer M. Granholm. “The proposed reform might also hinder joint efforts between the United States and Mexico related to clean energy and climate.”
The president of Mexico, Andres Manuel Lopez Obrador He said that he received a list of the American and Canadian companies that have expressed their disagreement, and pointed out that “if they consider that there is an injustice, the cases are reviewed.”
Granholm stated that “I was assured that Mexico is committed to supporting clean energy and resolving current disputes with energy projects within the framework of the law.”
Last year, López Obrador proposed a constitutional reform to restrict electricity sales by private generation companies and favor the Mexican state company.
The bill that López Obrador presented in October would cancel the contracts through which 34 private plants sell electricity to the national grid. The initiative would also declare “illegal” 239 other private plants that sell power directly to corporate customers in Mexico. Almost all of these plants operate with renewable energy sources or with natural gas.
The measure would also cancel many long-term electricity supply contracts and preferential purchasing programs for clean energy, which often affect foreign companies.
The plan puts natural gas-fired thermoelectric plants near the bottom of the queue — just ahead of state coal-fired plants — for the right to sell electricity to the grid, even though they produce it 24% cheaper. State thermoelectric plants that burn fuel oil would have preference over wind and solar plants.
The plan guarantees the state electricity company a market share of at least 54%, even though the free trade agreement between Mexico, the United States and Canada prohibits the favoring of local or government companies.