Mexico Allocates 40 Ha for Circular Economy Hub in Puebla

Mexico’s federal government has designated 40.4 hectares in San Jose Chiapa, Puebla, for the country’s first Pole of Circular Economy Development for Well-Being (PODECOBI), relocating the flagship project after it was rejected in Hidalgo and positioning it as a pillar of the National Development Plan 2025–2030. The park will offer fiscal incentives and focus on waste management, recycling, construction materials, energy transition and sustainable supply chains, while requiring environmental reporting and mitigation measures. The initiative underscores Mexico’s push to align industrial policy with circular economy regulation, even as local stakeholders raise legal and water-availability concerns that could affect execution and investor certainty.

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Mexico’s federal government formally designated 40.4 hectares in San Jose Chiapa, Puebla, for the installation of the nation’s first Pole of Circular Economy Development for Well-Being (PODECOBI), according to a declaration published March 2 in the Official Gazette of the Federation (DOF). The project, backed by fiscal incentives and framed as a cornerstone of the National Development Plan 2025–2030, marks the relocation of the federal administration’s flagship circular economy park after a similar initiative was rejected by voters in Hidalgo.

The declaration, signed Feb. 19 by Minister of Environment and Natural Resources Alicia Bárcena, establishes three polygons totaling 40.428 hectares on public land owned by the state of Puebla. The site meets criteria set out in federal guidelines, including transport connectivity, population thresholds, public ownership and sustainability standards.

Under the agreement, Puebla’s state government will allocate up to 8% of the property free of charge to public research institutions or universities for projects linked to circular economy development, environmental sustainability and technological innovation.

The federal government justified the project under the Constitution’s guarantee of the right to a healthy environment and the National Development Plan’s strategy to promote circular economy policies that optimize resource use and reduce pollution. A viability ruling was issued Feb. 16 by the Subsecretariat of Sustainable Development and Circular Economy.

The site is connected to major transport corridors, including Boulevard Industria Automotriz, the Teziutlán–Acajete road, the Cuapiaxtla–Cuacnopalan highway and the Audi Circuit. Authorities said the area has access to potable water, drainage systems, electricity, telecommunications, health and education services, road infrastructure and waste collection services.

The project is located within a regional area with a population exceeding 116,000 residents across five municipalities: Libres (37,257 residents), Nopalucan (32,772), Oriental (19,903), Rafael Lara Grajales (15,952) and San Jose Chiapa (10,443).

Although the site is not located within federal, state or municipal protected natural areas, nor within Ramsar wetlands or officially decreed conservation zones, the declaration acknowledges intersections with technical planning instruments, including the Priority Hydrological Region RHP-70 Cuenca Oriental and areas identified for the conservation of wild relatives of Mesoamerican crops. Authorities stated these classifications do not constitute legal restrictions but may require mitigation measures during environmental permitting processes.

Developers operating in the park will qualify for fiscal benefits established in a July 2025 decree, provided they submit quarterly reports detailing their net contributions to local, municipal or regional decontamination efforts, as well as annual reports outlining project progress and material traceability.

Federal Government Asserts No Local Consultation Necessary

The formalization of the Puebla Circular Economy Park follows the collapse of a similar project in Hidalgo. Originally planned as the Tula Circular Economy Park, the initiative included converting the Francisco Pérez Ríos thermoelectric plant from fuel oil to natural gas, river remediation projects and the construction of a waste treatment center. As of mid-2025, rehabilitation of natural gas transport infrastructure was underway with investment estimated at MX$42.7 billion (US$2.41 billion).

However, a citizen consultation held in the municipalities of Tula de Allende, Atitalaquia and Tlaxcoapan halted the project in December 2025. Official results showed 7,736 votes, or 63.10%, opposed the park, compared with 4,334 votes, or 35.35%, in favor. Turnout reached 8.77% of the 139,831 eligible voters.

President Claudia Sheinbaum said the federal government would not proceed without local support. “We conduct consultations; whether people want it or not, we respect their reasons,” she said at the time, adding that participatory governance is summarized by the principle: “With the people, everything; without the people, nothing.”

Sheinbaum later confirmed Puebla as the new location, citing both technical and social considerations. She stated that the project would retain its circular economy model, including recycling tires for road construction, recovering textile fibers from used clothing, transforming plastics into fuels or new materials, and processing construction debris into cement inputs.

Sheinbaum also asserted that no nearby communities would be directly affected. “There are no nearby communities at the proposed site, which will allow the project to move forward.” According to the official project document, the National Institute of Indigenous Peoples (INPI) determined that no Indigenous communities are located within the designated project area, and therefore prior consultation was not required.

Nevertheless, local farmers and community organizations in the Libres–Oriental basin have complained that they were not consulted prior to the declaration. They argue the project was announced without prior engagement and have raised concerns about potential groundwater contamination and water scarcity. The surrounding area has experienced water stress linked to industrial demand, and a nearby landfill fire burned for several days in late February 2026.

In response, local opponents have announced plans to mobilize and pursue legal remedies, including injunctions, to challenge the project’s implementation.