CRE Wants to Alter Net Metering for Smaller Solar Systems

The Regulatory Energy Commission (CRE) presented a proposal to the National Commission for Regulatory Improvement (CONAMER) to modify regulations for solar panel users with systems above 25KW, or 0.025MW. These modifications aim to eliminate net metering, which made solar a more profitable venture in the past.

Through net energy metering (NEM), solar panel users with systems below 0.5MW could ‘store’ energy for up to a year, which helps them in balancing their energy usage over longer periods, as solar often generates oversupply when solar radiation is high and underperforms on cloudy days and when the sun goes down. CRE proposes that solar system owners must liquidate their energy surplus every month. CFE will pay the users for their surplus energy, but the tariffs for these payments will change. With the proposed US$0.04/KWh, selling this surplus will no longer be profitable, which greatly diminishes the economic viability of a photovoltaic solar system, an energy expert told Reforma.

CRE also proposed the creation of a new tax bracket, so that SAT can tax energy from industrial users even if its usage is for operational purposes, which will drive up the costs of solar. For individual users, the proposal includes the limitation of low-voltage residential solar panel installations to 10KW, often insufficient to carry a family’s power requirements. 

Experts have warned that uncertainty in the industry continues to force companies to stop betting on self-supply models and green energy. As previously reported by MBN, the challenges in the sector force private companies to shelve their energy development and supply plans. CRE’s modification proposal threatens these companies further, as distributed generation (DG) based on solar power remained a viable option. This decision could affect the sustainability efforts of private companies.

In June, SENER reported that it was unlikely Mexico would reach its goal to produce 35 percent of the country’s electricity from non-polluting sources by 2024. According to the energy ministry, it would not be until 2036 that the goal could be reached. However, it later argued that Mexico has ample potential to produce renewable energy. Only 5.3 percent of electricity comes from photovoltaic solar sources, arguably Mexico’s most viable renewable power source, against 71.4 percent provided by fossil fuels. 

Experts have emphasized that the government is favoring CFE over private companies in the energy sector. According to them, global energy markets in 2030 will increase their share of renewable energy by 65 percent. However, this is unlikely to happen in Mexico, since CFE continues to bet on fossil fuels and private initiatives to promote renewable energy are hampered.