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In the Global Energy Transition, Mexico Still Playing Catch-Up

By Yolanda Villegas - VEMO
Director, Legal, Compliance and Institutional Relations


By Yolanda Villegas | Director - Tue, 05/09/2023 - 09:00

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The energy transition and its importance in impacting the quality of life of present and future  generations is often discussed. However, little is discussed about its origins. The issue of the energy  transition began to gain international attention in the 1990s, although its roots go back to the 1970s,  when the first scientific studies began to warn of climate change caused by the emission of greenhouse gases from the burning of fossil fuels and its possible consequences for the  environment. 

Overall, the energy transition can be understood as a global process aimed at reducing the use of fossil fuels and increasing the use of renewable energy sources. This process is vital to combat climate change, reduce the countries' energy dependence and create a sustainable energy future. 

In 1992, the Earth Summit was held in Rio de Janeiro, Brazil, where the United Nations Framework  Convention on Climate Change was signed. This agreement established the need to reduce greenhouse gas emissions to prevent global warming. Since then, the energy transition has become a key strategy for meeting the emission reduction targets set by the Convention. 

Later on, the topic of energy transition became even more important with the adoption of the Kyoto Protocol in 2005, which led to commitments to reduce greenhouse gas emissions in industrialized  countries. In the last decade, the effects of climate change have intensified, as evidenced by the climate crises around the world, ranging from droughts to floods in areas where such phenomena had never been observed before. Growing concern about climate change has also led many countries to set ambitious renewable energy goals and implement policies to promote their development and use. 

In multiple international forums, such as the UN Climate Summit, the G20 and G7 meetings, among  others, the energy transition has become a central topic on the international agenda. At these events, countries present proposals and share their experience for the implementation of measures aimed at promoting the adoption and implementation of the energy transition. 

One of the most important cases is that of Denmark, a world leader in the energy  transition. It has set a goal of producing 100% of its energy from renewable sources by 2050. Today, 44% of the energy produced in the country comes from renewable sources, such as wind  power and biomass. 

It is also important to mention the case of Germany. In 2020, 47.8% of the energy produced in  Germany came from renewable sources. The country has set ambitious targets to reduce  greenhouse gas emissions and promote the use of electric vehicles. 

As one of the world's most populous countries, China is also one of the world's largest emitters of  greenhouse gases. However, China is also one of the leaders in the energy transition. By 2020, China accounted for 30% of the world's installed renewable energy capacity. 

So where is Mexico and its goals? Regarding the advancement of renewable energy, Mexico has made significant progress in recent years. According to the 2020 Annual Renewable Energy Report, the country increased its installed renewable energy capacity by 10% compared to 2019, and this trend is expected to continue. However, it is important to emphasize that most renewable energy in  Mexico still comes from hydropower, followed by wind and solar. Although the adoption of renewable energies is increasing, there is still a significant dependence on fossil fuels, especially in the transportation and power generation sector. 

To accelerate the energy transition in Mexico, it is essential to enhance the regulatory  framework, to make it solid and clear, and to encourage investment in renewable energies and  energy efficiency, as well as to promote competition in the energy market. This would imply the review and updating of existing laws and regulations, as well as the creation of new rules that  encourage the production and consumption of clean energy. 

In addition, it is essential to encourage investment, for which the creation of policies and measures to attract investment in renewable energies is imperative. Tax and financial incentives are measures  that have proven to have worked in other countries. Unfortunately, in Mexico, bureaucratic and administrative barriers have recently arisen that hinder investment in clean energy projects. 

Mexico requires a joint effort from the main actors, such as the government, civil society and the private sector, to establish policies and measures that encourage investment in renewable energies and energy efficiency, which will allow us to continue advancing with the energy transition, as well  as with the promotion of education and energy culture.

Photo by:   Yolanda Villegas

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