Nearshoring Is Still Possible: Energy Supply, DG are Key

The materialization of nearshoring in Mexico has become a subject of debate, particularly as US policy aims to attract supply chains back to its own territory. Despite this, Mexico still presents significant investment opportunities, and various companies have maintained their investment strategies in the country. However, energy remains a crucial factor for securing the arrival and expansion of companies in Mexico.

“Nearshoring is rewriting Mexico’s industrial map. Global companies want to be here, but energy availability has become one of their biggest concerns. When foreign investors look at Mexico, they quickly realize it is not just about finding land, it is about securing clean, reliable, and scalable energy,” says Javier Garza, President and Founder, Legand.

Despite ongoing global challenges Mexico’s industrial real estate market remains on a strong growth trajectory. The market is being driven by rising e-commerce demand, logistics expansion, and nearshoring opportunities, leading investment, development, and leasing of industrial parks across the country to continue to accelerate.

According to CBRE, in Mexico City, the development pipeline for industrial real estate now exceeds 2 million m², with 55% allocated to Built-to-Suit (BTS) projects and 45% to speculative buildings. This split reflects a dual demand: companies seeking tailored spaces and investors betting on strong future occupancy rates in key logistics corridors. Monterrey leads the way in industrial inventory, which grew 10.9% year-over-year, reaching 16.4 million m² by the end of 1Q25. In the Bajio region, industrial stock reached 14.4 million m², marking 4% annual growth, largely driven by Queretaro and Guanajuato, reports MBN. 

According to AINDA Energía & Infraestructura, industrial parks are currently at 100% occupancy with dozens of finished industrial parks that are not connected. “We are at 100% because there is no electricity available,” says José Pablo Rikenbach, Co-Founder, AUM, and ESG Executive Director, AINDA Energía & Infraestructura. Meanwhile, the Mexican Institute for Competitiveness (IMCO), states that demand is accelerating, and current growth projections may even be conservative. In this scenario, installed capacity has not kept pace with the country's needs, suggesting that satisfying peak demand will become increasingly challenging.

According to the PRODESEN 2024-2039, Mexico's projected annual energy demand presents a base growth scenario of 2.4%, with a low scenario of 2.1% and a high scenario of 2.9%. This projection, however, could be surpassed when compared to the previous 2023 forecast of 3.5%. Additionally, generation capacity only increased by 0.6% between 2023 and 2024, leaving a significant deficit relative to demand growth and deployed generation capacity.

In this scenario, the business case for alternative energy investment is evolving. For many companies, renewables and energy-as-a-service models are no longer just driven by ESG commitments alone, but by economics. Rising grid tariffs, reliability issues, and growing investor scrutiny are pushing companies toward on-site generation, clean energy procurement, and smarter load management. “Large corporations in Mexico have to meet ESG goals and sustainability objectives,” says Luis Quero, Mexico Country Manager, Atlantica. “They are under pressure from investors and clients, and they have to opt for alternative energies."

Solar makes economic sense in Mexico, especially when considering the shortcomings of the country’s current electrical infrastructure. Despite the halt on utility-scale generation projects, the Distributed Generation (DG) sector showed steady growth over the past few years and with new regulation in place, on-site generation has become an attractive alternative due to infrastructure challenges. 

DG continued its growth trajectory. By the end of 2023, DG reached an installed capacity of 3,364MW, marking a 28.7% increase compared to 2,613MW in 2022. Meanwhile, as previously reported by MBN, on-site generation represents one of the main paths for the industrial sector to not rely on Mexico’s gas powered electric grid and access cleaner energy. 

Mexico’s current regulations provide an accessible pathway for companies to produce their own energy. Self-supply installations between 0.7MW and 20MW now benefit from a simplified permitting process. Additionally, the threshold for exempt distributed generation that does not require a permit has increased from 0.5MW to 0.7MW.

According to the PRODESEN 2024, the growth potential for DG is projected to reach 8,000MW by 2030, and up to 11,000MW in a high-scenario forecast. According to COPARMEX, this suggests that by the end of the current administration, Mexico could double its investment in DG capacity compared to what is currently installed. The PRODESEN anticipates a total capacity addition of between 19,424MW and 28,947MW. This implies that DG and isolated supply could collectively meet at least 28% to 48.4% of the national electrical system's new generation capacity target by 2030, with this figure potentially reaching up to 72%. “With adequate promotion of DG, isolated supply, and CFE's investments, the targets set by the federal government could be achieved,” considers Carlos Aurelio Hernández González, National Energy Commission, COPARMEX.

Clean energy is a crucial component for companies seeking to relocate. “The demand for clean energy is highly pronounced in the automotive sector. Tier 1 companies have stringent clean energy requirements that can sometimes seem challenging, but standards were more lenient among Tier 2, 3, and 4 companies. However, these latter businesses now have to meet the stricter requirements of Tier 1 companies because traceability for all automotive parts is becoming more critical. With this traceability in place, the demand for clean energy is now taken very seriously,” identifies José Luis Aguirre, Director General, Sunlight Energy Solutions.

According to experts, despite uncertainty amid geopolitical interplays, ESG will continue to be relevant for the operations of companies across the world. “Increasingly, clients inquire about the CO2 emissions they will avoid by working with us. Although such questions were occasionally posed before, they have become standard. This shift demonstrates a real change in priorities. Naturally, factors such as tariffs, nearshoring, and geopolitics remain relevant, yet the emphasis is now on delivering measurable value through our solutions,” says Humberto Alarcón, Country Manager, Suneco.

Ultimately, it is the end consumer who drives demand, states Carlos Díaz, Blue Global Energy. “Even if public policy in the United States shifts, market forces and consumer expectations will continue to support the ESG agenda. Companies are aware of this. While supply chains may be restructured, the strategic partnership between Mexico and the United States remains strong. We do not foresee a reversal in the momentum behind renewable energy; on the contrary, we expect continued growth and development of new projects in this space.”

Follow our MBS 2025 tag and don’t miss our coverage leading to Mexico Business Summit 2025 on October 28–29, 2025. On Thursday, July 10, 2025, we will address the topic of industrial real estate and the potential to spread the benefits of nearshoring to more regions. 

Interested in staying ahead in the nearshoring landscape? Mexico Business Summit 2025 offers exclusive insights from leading industry experts and government officials on the key trends, risks, and opportunities fueling Mexico’s emergence as a global nearshoring powerhouse. Discover how supply chain innovations, workforce development, and sustainability strategies can strengthen your competitive edge.

Register now to secure your place and position your business at the forefront of this dynamic market: https://mexicobusiness.events/MBS/2025