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News Article

Chamber of Deputies Approves Counter-Reform

By María Fernanda Barría | Thu, 02/25/2021 - 15:19

The Chamber of Deputies has approved the modification of the Electricity Industry Law (LIE) with 304 votes in favor, paving the way for what many analysts define as President López Obrador’s Counter-Reform. The new law, which was proposed by the president himself, must still be approved by the Senate before being published in the Official Journal of the Federation. “We do not want electricity rates to go up and we are going to achieve it. The ruling has a sense of democratic responsibility,” Pablo Gómez Álvarez, a MORENA Deputy, told El País. “The essence of the initiative is to recover the planning and functions of the government in strategic areas, such as electricity, to guarantee energy and national security,” added Manuel Rodríguez, also a MORENA Deputy.


The initiative modifies the priorities for energy dispatch and prioritizes the CFE over private companies, with the objective of “gaining sovereignty.” It also favors CFE’s hydroelectric, nuclear, geothermal, combined cycle and thermoelectric plants over private wind and solar plants. According to El Financiero, on Wednesday, the president thanked the legislators and affirmed that the initiative will give “security that there will be no blackouts or increases in the price of electricity.”


According to Forbes, the Federal Economic Competition Commission (COFECE) recommended Congress not to approve the President’s initiative since, according to the commission, the changes would seriously harm competition in the country, increase electricity rates and damage CFE’s transparency. Likewise, it also emphasized that the current constitutional framework contemplates the possibility of competition in the generation and supply of electricity, activities in which, without exception, all public and private actors may participate.


During the discussion of the new reform, María de los Ángeles Ayala, PAN Deputy, pointed out that these reforms would violate international commitments, such as USMCA. “The way to strengthen CFE must be through investment, making this company more competitive with infrastructure, technology and investment. It has been demonstrated that CFE has healthy finances,” Ayala told Forbes.


The data used in this article was sourced from:  
Forbes, El País, El Financiero, COFECE
María Fernanda Barría María Fernanda Barría Junior Journalist and Industry Analyst