News Article

Mexico’s Electricity Spot Market Sees Increasing Interest

Wed, 02/15/2017 - 11:38

Speaker: César Hernández Ochoa, Deputy Minister of Electricity at the Ministry of Energy

Mexico’s still new electricity spot market is attracting increased attention from industry players and could see 11 new participants enter the field in the next months to complement the 15 already doing business in it, Mexico’s Deputy Minister of Electricity at the Ministry of Energy, César Hernández Ochoa, said on Wednesday during his remarks at Mexico Energy Forum 2017 at Mexico City’s Sheraton María Isabel.

“What we are seeing is that the short-term market, launched barely a year ago, has been able to attract top-level companies,” Hernández Ochoa said.

The country’s Energy Reform, which last year brought about the first electricity auctions by the Energy Regulatory Commission (CRE) and record-low prices for solar energy, is also attracting the attention of investors vying to snatch this year’s first energy transmission contract by CFE, with companies from all over the world looking to participate in a tender of a 600km High Voltage Direct Current (HVDC) power line from the southern wind power hub of Tehuantepec’s Isthmus to Morelos state in the center of the country, Hernández Ochoa added.

“That is the first of three large projects with investments of about US$1 billion to US$2 billion each that are attracting companies from Canada to the US to China. We have great expectations about these projects,” he said, explaining that a robust transmission network is needed to complement the country’s advances in the diversification of energy generation.

Mexico’s long-term energy auction winners, he added, are committing to the projects won and have been signing their contracts despite the uncertainty brought about by the political changes in the US, showing confidence in the future of the country’s energy industry.

“The winners are putting their money where they put their promises,” he said.