AGM Advocates for Financial Incentives for Geothermal Projects

The Mexican Geothermal Association (AGM) has called for financial incentives to boost Mexico’s geothermal sector, proposing for these incentives to come primarily from a proposed “decarbonization bond” initiated by the oil industry.

Heber Díez León, President, AGM, suggested that the oil industry's revenue could fund geothermal projects through a decarbonization bond. This bond would encourage exploration and drilling in the geothermal sector, addressing the high costs associated with these activities. 

Díez highlighted the disparity between the number of wells drilled by the oil industry and the geothermal sector. While PEMEX drilled 199 wells in 2022 and 358 wells in 2023, only a fraction of these would be required for geothermal exploration and deployment.

Despite the initial investment required, Díez León underscored the long-term benefits of geothermal power technologies. Geothermal power plants boast higher capacity factors compared to gas plants and can operate consistently regardless of time of day or weather conditions. However, despite these advantages, geothermal energy currently comprises only 1.12% of Mexico's energy mix.

Mexico ranks 8th globally in installed geothermal power capacity, with 976MWe. To further discuss advancements and opportunities in the geothermal sector, AGM will host the XXX Annual Geothermal Congress in Michoacan on May 23 and 24, 2024.