Private Sector Reacts to New Energy Reform’s Defeat
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Private Sector Reacts to New Energy Reform’s Defeat

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María José Goytia By María José Goytia | Journalist and Industry Analyst - Mon, 04/25/2022 - 12:12

Following the rejection of President López Obrador's new energy reform, Mexico's private sector acknowledged the work done by the parliamentary opposition to prevent the constitutional reform. However, the private sector remains cautious and does not rule out further uncertainty in the electricity sector.

The Business Coordinating Council (CCE) acknowledged the responsibility shown by opposition legislators from PRI, PAN, PRD and MC, who stopped the energy reform initiative with their votes. CCE stated that its commitment to contribute to Mexico having sufficient, cheap and clean energy to combat climate change and achieve economic growth remains strong.

In addition, CCE expressed its interest in promoting economic conditions that encourage investment, innovation and competition, all while prioritizing Mexican households. "An open and modern country like ours requires a clear, transparent and reliable legal framework, as well as the application of technical criteria in the energy sector’s operation," the council said.

Furthermore, the Mexican industrial sector is represented by the National Confederation of Industrial Chambers (CONCAMIN), its members using 60 percent of the electricity generated in the country. CONCAMIN stated that the opposition’s vote against the energy reform "gives certainty to the business community and the national economy, generating an environment of confidence." The confederation also underscored the private sector’s commitment to creating a more competitive and sustainable country, encouraging the use of clean energy at lower costs.

Similar to CCE, the Employers Confederation of the Mexican Republic (COPARMEX) also recognized the parliamentary work done by the opposition: "We recognize the work of the Deputies who voted against the Constitutional Reform proposed by the President, which went against family budgets, the environment, free competition, compliance with international treaties.. and which caused enormous legal uncertainty toward investment."

"A long-term vision is required, one where we have a stronger CFE, a country with clean energy, where the rule of law and international agreements are respected and where investment is encouraged, to generate the adequate energy the country requires toward its growth," COPARMEX added.

However, COPARMEX also warned about the possibility that the government's policy will continue to prevent private operations in the Mexican electricity sector. "We are concerned that once the energy reform has been discarded, the government will continue to try to impede the operation of private power producers and hinder free competition, all to the detriment of Mexican households," commented José Medina, President, COPARMEX.

Régulo Salinas, President of the Energy Commission, CCE, concurred and warned that Mexico will likely suffer blackouts due to electricity shortages in the following years due to the lack of investment in new power producing capacity throughout the past three years. Salinas pointed out the "administrative paralysis" of regulatory body CRE, which has not granted many new generation permits to the private sector during the López Obrador administration.

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