Mexico Strengthens Climate Change Policy at Major Economies ForumBy María José Goytia | Wed, 06/22/2022 - 16:10
President López Obrador presented Mexico’s guidebook to combat climate change and compel with the Paris Agreement clean energy goals. Meanwhile, Mexico Evalúa’s latest study shows that PEMEX and CFE are on a severe risk threshold regarding ESG criteria. Furthermore, Canadian company Solfium, announced an alliance with Queretaro’s state government to accelerate the local energy transition to renewable energy.
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President López Obrador participated in the Major Economies Forum on Energy and Climate (MEF), a summit led by US President Joe Biden. Mexico’s head of government presented a guidebook of actions that the country is undertaking to fight climate change, which include investment in solar energy, methane emissions reductions and hydroelectric power plant modernizations. At the forum, President López Obrador reiterated Mexico's commitment that by 2024, 35 percent of the country's energy consumption will come from clean sources.
President López Obrador agreed with 17 US renewable energy companies to develop 1,854MW of solar and wind energy in Mexico. In addition, new US investment is planned for the construction of solar parks along the Mexico-US border. Further investment toward the elimination of methane gas emissions from PEMEX are also part of the plan. The agreements were announced during the Major Economies Forum on Energy and Climate Action, following weeks of negotiations between the Mexican government and US diplomats. If they materialize, these projects may end the investment drought the energy sector has faced during President López Obrador’s administration.
The Mexican government reaffirmed a commitment that it may not be able to fulfill. President López Obrador has made a commitment to representatives from 22 countries that Mexico will generate at least 35 percent of the energy it consumes from clean sources by 2024. However, the Program for the Development of the National Electricity System (PRODESEN), a key document for the sector, recognizes that this goal may not become reaility until 2031, seven years later than Mexico's commitments stipulate.
In 2021, Mexico ranked fifth on the list of countries facing the most disputes in the energy sector, behind the US, Brazil, Spain and the United Arab Emirates, according to the International Chamber of Commerce (ICC). Between 2019 and 2021, Mexico climbed up nine places. The many regulatory changes made by the federal government during this period are a key motivator for these arbitrations.
The Canadian solar tech company Solfium and Queretaro’s Energy Agency formed an alliance to promote Distributed Generation (DG), which is to play a key role in the state's innovative energy transition strategy. Through the alliance, the company will install 230,000 solar panels with a total capacity of 125MW to provide electricity to 80,000 homes in the state. This project would reduce 1.85 million tons of harmful CO2 emissions.
Enlight, a Mexican company specializing in clean energy solutions, presented its "Outlook for Solar Energy in Mexico" and the benefits of incorporating PV solar systems in industrial production chains. During the event, the company emphasized the economic viability of solar energy as a sustainable energy alternative. It highlighted Solar’s attractiveness for businesses generate a positive impact on the environment and their finances.
Mexico faces a crucial time regarding its energy policy. The rejection of President López Obrador’s energy reform proposal in Congress, the Supreme Court’s reactivation of the Electricity Industry Law (LIE) reform of 2021 and the pressure to meet international decarbonization commitments challenge the energy sector domestically. Meanwhile, rising fuel prices, inflation and the race against the clock to fight climate change are influencing international energy markets. As the industry adapts to these challenges, spaces to maintain a dialogue and foster understanding become progressively relevant. These topics and more about the present and future of the Mexican energy sector will be discussed by decision-makers and key players at Mexico Energy Forum 2022 ECHO.