Mexico’s Path to Energy Sovereignty: Reducing Natural Gas Imports

In 1990, half of the electricity generated in Mexico came from oil, and only 12% was generated with gas. During the following decades, the strategy consisted on transitioning to a more efficient and less polluting solution: combined cycle power plants fueled with gas. As a result, 25 years later, gas fueled 55% of electricity generation and oil’s share was reduced to 14%.

Gas helped Mexico go through its first energy transition, reducing the costs, pollution, and greenhouse gas emissions associated with the electricity sector, with no other technology mature enough to compete. But not anymore. In 2026, the cheapest and cleanest source of electricity is by far renewable energy, and importantly, it is the focus of the national strategies for energy security all over the world, as well as in Mexico.

Last month, President Claudia Sheinbaum stated that achieving energy sovereignty for Mexico was a priority for her administration. She highlighted the fact that 75% of the gas used in Mexico is imported from the United States and that we needed to find ways to reduce this dependency. There are basically two ways to do that: consume less and/or produce more. Expanding domestic gas production is one possible route, though it involves complex environmental, social, and investment considerations.

In a global context increasingly shaped by decarbonization and energy transition commitments, supply expansion may not offer a durable and politically correct solution. This article therefore concentrates on the demand side of the equation: How reducing consumption can provide a durable foundation for Mexico’s energy security, while supporting long-term sustainability goals and offering greater geopolitical stability.

According to the latest National Energy Balance, gas plays a major role in all energy uses in Mexico, as it covers over one-third of all energy available for consumption, including fuel and electricity. Who are the main gas users? Firstly, the industry sector (56%), followed by the residential sector (22%) and the commercial sector (7.4%). The remaining gas consumption is distributed across the agricultural, transport, and public sectors. An additional and significant share — around 15% — is accounted for as losses.

Around three-quarters of direct industrial gas use is for heat generation. Industries such as food processing, textiles, and rubber manufacturing require predominantly low-temperature heating (below 100°C). It is technically feasible to substitute gas in low-temperature industries directly with solar thermal systems and industrial heat pumps (equipment that absorbs heat from the environment into the process). These technologies are commercially available and already deployed in multiple markets for process heat applications. Other sectors, such as metallurgy, plastics, paper, and chemicals, require higher temperatures. While low-temperature solutions may not be able to fully replace gas, they can significantly reduce gas consumption by using them for pre-heating processes.

After the invasion of Ukraine in early 2022, the loss of energy security in several European countries gave way to an increase in heat pump sales, growing around 40% from 2021 to 2022. According to data from the European Heat Pump Association, heat pump installations reached 25.5 million units in 2025, with the goal of the European Union to reach 60 million by 2030. In Mexico, heat pumps could operate more efficiently than in Europe, as warmer ambient temperatures allow higher performance and reduce the amount of energy needed to reach industrial process temperatures.

Gas has historically supported Mexico’s industrial development because it has been affordable and accessible. However, current geopolitical conditions and the country’s high dependence on imported gas introduce structural vulnerability. Under these circumstances, producing industrial heat on-site through renewable thermal technologies and electrified solutions becomes more than an environmental strategy, it is also a resilience strategy.

Apart from industry, cooking and water heating are the main gas uses in both the residential and commercial sectors, consuming around 400 PJ annually. While electric cooking remains limited in Mexico, in the United States, electric stoves are used in most commercial establishments, as well as in over half of households.

On the other hand, water heating can be easily substituted by thermal solar panels, which can reach temperatures of 80°C. Mexico is already a recognized player in the global solar thermal market. According to the Solar Heat Worldwide 2024 report, Mexico ranked eighth globally in newly installed solar thermal capacity in 2023. It is also one of the top countries worldwide in its deployment in the residential and commercial sector. Despite having a well-established solar thermal industry, its use in the industry remains underutilized relative to its technical potential for process heat applications.

In the case of agriculture, gas needs are mainly used for the heating of greenhouses and barns. Consumption represents less than 1%, but there is a circular opportunity here. When turning the polluting waste of barns (manure) into biogas, farmers increase their resilience toward gas scarcity, and at the same time, prevent them from acquiring expensive environmental services to treat manure.

Even though gas has historically been used because of its low cost, replacing it with on-site heat and biogas production is a strategic decision and a structural, long-term solution for all sectors. It is, in itself, an application of circular economy principles: closing energy loops and reducing resource extraction by shifting from finite fossil fuels to infinite and locally sourced heat, including biogas, solar thermal, and ambient heat.

Gas remains a key energy source in Mexico, and it is unlikely to be fully replaced in the coming decades. However, Mexico is well positioned to significantly reduce its dependence and present an entirely different picture in 2050. A sharp decline in gas consumption also means progress on corporate net-zero targets, more resilient industrial processes, and stronger energy sovereignty.