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News Article

CRE Gives Go-Ahead for 13 Energy Projects

By Cas Biekmann | Tue, 12/22/2020 - 13:20

CRE, the regulatory commission for Mexico’s energy sector, has given the green light for the construction of 13 energy projects. According to CRE the projects have been allowed to change their schedules that were held back by the pandemic and can be interconnected to the grid at a later point in time.

The news might come as a positive surprise to renewable developers. MBN experts considered 2020 to be a very slow year in regards to permitting for both energy projects and fuel sales. “CRE has effectively and publicly taken the position that it will delay issuing new permits either for power generation or associated power market activities that require the issuance of permits. The end result is fewer players in the market, thus restricting the options and ability to secure more and cheaper energy in the WEM,” wrote Carlos Ramos and Miguel Ángel Mateo, both Partner at Hogan Lovells for MBN.

Nevertheless, 13 projects, which include private renewables and thermal energy plants from CFE, are now able to continue their construction process:

Fotovoltaica Border Solar Norte, from IENova

Don Diego Solar, from IENova

Fotovoltaica ENH

Proteus Solar, from Prana Power

Tampico Solar, from Prana Power

CFE Generacion I

Combined Cycle La Charreria, built by Fisterra Energy

Iberia Renovables Durango, purchased by Risen Energy in 2017

Magdalena Solar, from Más Energía

Parque Amistad II, from Enel Green Power

Parque Salitrillos, from Enel Green Power

Sol de Insurgentes, from Engie

Pollux Energy Project

Project developers in the energy sector bet many millions of dollars on projects, knowing that their return margins are traditionally narrow. Because of this, any whiff of uncertainty regarding regulation and permitting is problematic. Jacobo Mekler Weisburd, Partner at Mexican energy developer COMEXHIDRO, outlined the issues the company faced in 2020: “We developed our first gas-based project in conjunction with a group of companies led by Invenergy, a 600MW open cycle gas plant called Los Ramones. We had all the financial resources to build this but the pandemic caused delay that pushed our project past the commercial operation permit deadline. As a result, for the past five months, we have been waiting to interconnect the completely finished plant and have not been able to do it because CRE had not responded on time due to COVID-19. Furthermore, the company has a pipeline of solar projects it has not been able to build yet. We want to be sure that if we build these on time they will be allowed to interconnect,” he said in an MBN interview.

Cas Biekmann Cas Biekmann Journalist and Industry Analyst