Mexico Grants Powers for Public Utility, Hurting Renewables

(Bloomberg) -- Mexico has fast-tracked measures granting more authority to the state utility at the expense of clean energy companies, ignoring regulator and industry concerns over the economic and environmental impacts of the new measures.

The proposal by the Energy Ministry was approved and published in Mexico’s official gazette on Friday evening. It comes after the National Commission for Regulatory Improvement, known as Conamer, had tried to stall the process to request further regulatory impact studies, arguing it would cost companies to comply with the new rules.

The new measures give the Energy Ministry the ability to impose a number of limitations and tests on new solar plants and wind projects. It also gives the National Center for Energy Control, known as Cenace, the power to reject new plant study requests and prioritize state-run utility Comision Federal de Electricidad. Without the tests, new plants would not be able to come online.

“The planning and reliability of the National Electric System requires rational economic regulation for the accelerated and progressive incorporation of all energies,” the Energy ministry said in a statement Saturday. “In the case of intermittent energies, they must be incorporated through the intervention and necessary support of plants that have full availability and provide planning and operational reserves.”

The head of Conamer, Cesar Hernandez, announced his resignation on Friday on Twitter, the same day the measures were approved.

A letter from a European Union delegation states the rules will negatively impact dozens of clean energy projects across Mexico, Milenio newspaper reported. The Canadian Embassy confirmed it also sent a letter to the government saying that the measures put at risk Canadian investment of $450 million in renewable projects.

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