CRE Publishes Isolated Supply Requirements, Grid Code 2.0

Mexico’s Energy Regulation Commission (CRE) published the criteria by which isolated energy supply, meant purely for self-use, is to be defined. CRE furthermore altered characteristics of the grid code, with both provisions already in force.

The term self-supply can be confusing in the Mexican context. Mexico’s first private energy contracts, originating from before the 2014 Energy Reform, are referred to as a self-supply scheme. This term is somewhat misleading, because these schemes can involve energy projects featuring contracts with various offtakers in different locations. But according to CRE’s definition, self-supply of electricity considers that a company generates electricity solely for its own use or for the use of a surrounding group with similar economic interests. Self-supplied electricity cannot be transmitted or distributed via the national grid. This means that following CRE’s rules, companies cannot sell their surplus energy or purchase missing power or electricity for consumption within a self-supply facility. By nature, this form of supply benefits from having power plants close to the point of consumption, for example a cogeneration power plant within an industrial park.

The commission furthermore requires self-supply power plants to have an installed capacity equal or less than the maximum demand the company requires. “When the power plant does not allocate part of its capacity to satisfy the demand of the load centers, or where appropriate the demand of the load centers is zero, the power plant will not be able to inject electrical energy into the National Electric System (SEN),” CRE’s accord reads.

On the same day, CRE published a resolution regarding Mexico’s grid code, an important tool to safeguard the desired efficiency, quality, reliability, continuity, safety and stability of the SEN. The original provisions of the grid code, published in 2016, remain in force. The new resolution therefore focuses mostly on how the SEN should be protected. “The SEN should be controlled in a way that maximizes the time it remains within its technical limits,” one criterium states. Interconnection of power plants and connection of new load centers should also be in line with the efficiency, quality, reliability, continuity, safety and stability of the SEN. As such, the new grid code could influence the planning and control of the development of Mexico’s energy infrastructure, as well as who gets access to it. Decrees and regulation allowing the government more control over who gets access to the grid or not has been part of the government’s efforts to reform the energy sector but has so far been successfully challenged in court. A constitutional reform is now scheduled to be discussed in Congress.

Rather than an instrument for control, people involved in the creation of the grid code, such as independent energy advisor Héctor Beltrán, say the code merely aims to expand on existing provisions and to help balance the national grid. “It is not about moving against or in favour of certain groups, but rather about thinking in a more social mindset that considers all end-users,” he told Energía Hoy.