Panel discusses Mexico’s challenges in opening electrical energy market

Emma Acosta

Government officials and private sector energy experts discussed the issues facing Mexico’s renewable electrical energy in a UT Energy Week panel at the Etter-Harbin Alumni Center on Tuesday. 

In December 2013, the Mexican government reformed its constitution to open the energy market to investors. Formerly, the sole provider of energy in Mexico was the Commission of Federal Electricity (CFE). 

Norma de la Salud Álvarez Girard, panelist and general director of Integration of Clean Energy at the Energy Regulatory Commission, explained Mexico’s initiative to integrate renewable energy into their plan, which allows foreign investors into its energy market.

Álvarez said energy generators must first apply for permits and later receive a clean energy certificate. Mexico also recently announced its goal to obtain 35 percent of their total energy from renewable resources at the 2015 United Nations Climate Change Conference in Paris. 

“[Mexico needs] to change the matrix to include more clean energy into the grid,” Álvarez said. ”We have to achieve the 35 percent at least before 2024.”

With the reforms, Mexico intends to promote competitiveness and private investment throughout the electric power sector and support economic growth and job creation. Their goal is to deliver competitively priced, clean and secure electricity.

Felipe Cardoso Saldana, a chemical engineering graduate student, said it is fascinating to learn about how both countries could benefit from the energy reform due to their differences in peak energy hours.

“I think something important is the integration between Texas and Mexico, which is something that has not occurred that much but is starting to take place,” Cardoso said. “… Because they were saying how the peak hours are different, so there’s a surplus at certain amounts of hours of the day in Mexico that could go to the U.S. and vice versa, so in the future, that could be an important thing,” 

Because this is a young market, there are still a lot of unanswered questions regarding the profit potential of investing in electrical energy. Panelist Erika Benson, president of Benson International Group, said there are some concerns for investors who are worried about entering a market previously controlled by CFE.

”As we talk about renewables, connecting resources to the grid and really understanding how is reliability going to work, how are losses going to work, how are we really going to tackle those issues?” Besnon said. “This is a whole new process.”