Energy Advisor 2024-11-22 – Inter-American Dialogue

LATIN AMERICA ADVISOR

Energy ADVISOR

A daily publication Of the dialogue

November 22, 2024

What Does a Major Energy Reform Entail for Mexico?

Mexican President Claudia Sheinbaum will oversee the implementation of the country’s most substantial energy legislation in more than a decade. // File Photo: Mexican Government.

Q

Mexico’s constitutional energy reform became law on Oct. 31 when a supermajority of state legislatures voted in favor of the measure to strengthen the role of state-owned Pemex and CFE, ensuring that the state controls at least 54 percent of all electricity generation. Critics say that the measure, which was a cornerstone of former President Andrés Manuel López Obrador’s legislative agenda, will hinder current President Claudia Sheinbaum’s efforts to triple Mexico’s renewable energy capacity and make the country a net energy exporter by the end of her term in 2030. What does the reform mean for Mexico’s energy sector? To what extent will the overhaul discourage private investment in future energy projects? How have investors reacted to increased state control of the energy supply, as well as the prospect of public-private partnerships with Pemex and CFE?

A

Rolando Fuentes, nonresident scholar at the Baker Institute’s Center for the U.S. and Mexico: “Mexico’s constitutional energy reform represents a significant move toward increased state control over the energy sector, which may prioritize state-owned entities at the expense of private participation. While the reform seeks to bolster national energy sovereignty, it could undermine efforts to expand Mexico’s renewable energy capacity by creating a less flexible and less competitive market environment. The rigid allocation of generation capacity and the cap on renewables may impede Mexico’s transition to a sustainable energy future. Strengthening state-owned companies should be a secondary goal in energy policy…”

Top News

Brazilian Data Centers Secure Clean Power

Data centers in Brazil have signed 330 megawatts worth of power contracts for wind and solar energy since 2021, according to a recent report from a clean energy consultancy.

Subscribe now

Brazil, Argentina to Study Vaca Muerta Exports

Brazilian and Argentine officials signed an agreement on the sidelines of the G20 summit to study projects that would link Argentina’s shale-rich regions with Brazilian consumers.

Subscribe now

Bolivian Truck Drivers Protest Diesel Shortage

Bolivian truck drivers set up new roadblocks this week to protest the government of President Luis Arce’s management of the country’s fuel supplies. Some drivers say they have gone more than 10 days without access to diesel. // File Photo: Bolivian Government.

Subscribe now

Complete editions of the Energy Services Advisor are delivered on a biweekly basis to members of the Dialogue’s Corporate Program and other subscribers. Sign up below for a free complimentary preview subscription.

ABOUT THE Energy ADVISOR

A sister publication of the Inter-American Dialogue’s daily Latin America Advisor, the weekly Energy Advisor captures fresh analysis from business leaders and government officials on the most important developments in oil and gas, biofuels, the power sector, renewables, new technologies, and the policy debates shaping the future of energy in the Western Hemisphere and beyond. To subscribe or for more information, contact Gene Kuleta, editor of the Advisor, at gkuleta@thedialogue.org.