The Tula oil refinery, located next to the Tula power plant owned by the Federal Electricity Commission, north of Mexico City.Henry Romero / Reuters
The Chamber of Commerce of the United States has accused this Friday that the legislative initiative to reform the electricity sector in Mexico fails to comply with what was agreed in the trade agreement signed between both countries and Canada (TMEC).
The Chamber has described as "deeply worrying" the proposal that the Mexican president Andrés Manuel López Obrador sent to Congress on Monday, which seeks to strengthen the role of the parastatal Federal Electricity Commission (CFE) on private plants to increase their production to the grid, which would deal a blow to renewable energy plants.
"Such drastic changes would open the door for the reestablishment of a monopoly in the electricity sector and, we believe, would directly violate Mexico's commitments under the Mexico-United States-Canada Agreement," the senior vice president for the Americas said in a statement. from the US Chamber of Commerce, Neil Herrington.
The Chamber has also warned that the proposed changes to the Mexican Electricity Industry Law (LIE) would "significantly increase" the cost of electricity and limit access to clean energy for citizens.
"Unfortunately, this measure is the latest in a pattern of worrisome decisions taken by the Government of Mexico that have undermined the confidence of foreign investors in the country" when it needs "more than ever" more foreign investment to emerge from its worst contraction economic since the Great Depression.
The initiative presented by the Mexican president represents a profound review of the energy reform promoted in 2013 by his predecessor, Enrique Peña Nieto.
One of the biggest changes involved the creation of an electricity market based on the principle of "economic dispatch", which states that the plants with the lowest production cost - the most efficient - must be the first to upload electricity to the grid.
This principle favored renewables, generally cheaper and in private hands.
Meanwhile, CFE's hydroelectric and thermoelectric plants, with higher production costs, had to wait their turn.
López Obrador has been a great opponent of the opening of the energy sector of the previous Administration, arguing that the reform favored the private companies and caused a “serious damage” to the CFE, since it sometimes prevented the parastatal plants from emptying their load.
The second chamber of the Supreme Court of Mexico declared Wednesday that the president's proposal hinders free competition and unduly benefits the CFE.
Like the United States, the representation of the European Union in Mexico also expressed its “deep concern” about what private and non-governmental organizations see as a setback in the commitment to move towards clean energy.