COPARMEX Leads Energy Proposal Amid Calls for Modernization

In a bid to align with international sustainability demands, the Mexican Confederation of Employers (COPARMEX) unveiled a national energy proposal aimed at providing legal certainty, stimulating investments, and addressing Mexican citizens' needs.

During the "Clean Light for All Mexicans" virtual forum, COPARMEX President José Medina Mora stressed the urgency of expanding energy infrastructure and ensuring legal certainty to incentivize nearshoring. In 2020, Mexico generated 29.2% of its energy from renewable sources, edging closer to its 2024 target of 35%, but faces hurdles due to insufficient permits for renewable energy interconnections. Leonardo Robles Castillo, COPARMEX's National Energy Commission President, emphasized the need for a coordinated energy transition, advocating for dialogue among stakeholders to ensure accessible, profitable, and reliable energy.

Robles Castillo pointed out that planning, innovation, and public-private participation are fundamental pillars to strengthen CFE’s operation. Additionally, he suggested that this matter should be approached from two perspectives: generating public policies to improve the sector and provide greater benefits to end users and favoring better corporate practices to support the sector. 

Carlos Aurelio Hernández, National Vice President of Renewable Energies, COPARMEX, pointed out the importance of strengthening the state productive enterprise, considering that only in 2021, it recorded technical and non-technical losses amounting to MX$13 billion (US$760 million).

Panel discussions delved into reviving long-term auctions to secure cheaper energy and bolster internal competition, addressing the need for greater representation of SMEs in the Wholesale Electricity Market (MEM), and enhancing regulations for distributed generation to accommodate increased capacity and storage systems. Experts highlighted the importance of strengthening regulatory bodies like the CRE and CENACE through economic, technical, and managerial reinforcement, advocating for their independence to uphold impartial decision-making.

Participants made it clear that CFE is a productive state enterprise and "should not be a regulator, should not be an authority, and should not be a system operator." Therefore, both CRE and CENACE must be guaranteed budgetary, management, and decision-making independence so that their determinations are technical rather than political. They pointed out some weaknesses, such as the lack of personnel to address the market, flaws in institutional design, and decisions made by the current administration for strategic political reasons.

Regarding options through which the private sector could have a greater representation in the electricity sector, and even be part of an advisory or managerial group in these organizations, although they recognized the importance of the productive sector's voice, they pointed out that mechanisms already exist, such as those of CONAMER, through which participation is possible.

They propose involving the private sector in regulatory councils through mechanisms like public consultation, emphasizing the need for technocratic appointments to prevent regulatory capture and ensure market integrity. COPARMEX underscored the imperative of scaling up investments in transmission and distribution to expand the energy market, fostering competition for the benefit of end-users.