Power Demand Rises as Investment Lags, IMCO Warns

Mexico’s electricity system faces growing pressure from rising demand and declining public investment, according to an analysis of the Power Sector Development Plan 2025–2039 (PLADESE) by the Mexican Institute for Competitiveness (IMCO). SENER’s plan outlines the roadmap for the National Electric System over the next 15 years as consumption growth continues to outpace infrastructure expansion.

PLADESE projects that national electricity demand will grow at an average annual rate of 2.5% through 2039, broadly in line with expected GDP growth. Gross consumption reached 359,807GWh in 2024, a year-on-year increase of 2.3%, while peak demand climbed to 55,528MWh. By 2039, maximum demand is expected to rise more than 50%, reaching 83,643MWh, increasing the challenge of ensuring system reliability during peak periods.

At the same time, investment trends point in the opposite direction. Physical investment in the electricity sector fell 28.1% in real terms year on year by 3Q25. The federal budget allocates MX$61.1 billion (US$3.397 billion) to the Federal Electricity Commission in 2026, a real decline of 16.7% compared with the previous year. IMCO estimates that average annual investment of more than MX$104 billion will be required toward 2030 to meet system needs, leaving a substantial funding gap under current allocations.

Installed generation capacity reached 90,543MW at the end of 2024, an increase of 1.7% from the previous year, below the pace of demand growth. Conventional plants account for 63.1% of capacity, while clean energy technologies represent 36.9%. However, clean sources contributed only 26% of actual generation in 2025, keeping Mexico below its national target of 45% clean generation by 2030.

To address these challenges, PLADESE calls for the addition of 76,000MW of new capacity between 2025 and 2039 through a mixed public and private investment model. The plan assigns a significant role to private developers, particularly in renewable generation and battery storage, as well as in expanding transmission infrastructure. IMCO noted that clearer allocation mechanisms and regulatory certainty will be critical to attract private capital and ensure supply security as demand continues to rise.