Morena, the ruling party in Mexico will approve this very Tuesday the controversial electricity reform pushed by president Andres Manuel Lopez Obrador that, according to experts, may rollback renewables and put private investment at risk.
Firstly, during the weekend, the lower chamber of Mexican Congress, and its Energy Commission, approved the reform with minor changes. Now, the discussion will pass to the higher chamber of senators, where it will be approved with no major complications, according to sources quoted by Infobae.
“We want to finish years of take out promoted by the neoliberal government; it affected deeply our nation and our energy sector,” said Ignacio Mier, head of the lower chamber. Secondly, it’s going to be virtually impossible for the political opposition in Mexico to roll back the reform; as the ruling party has the majority in Congress.
Thirdly, as we reported previously, earlier this month, president Obrador pushed a bill that would change the order in which power is placed to the Mexican grid; privates would lag behind, as the bill intends to replace national electricity company CFE as the main provider.
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Consequently, the reform would be a particular hit to renewable producers; they had been dispatching electricity at the first place, as their input is the cheapest; now, they would stand last in queue, losing their premier spot.
In addition, Mier assured that the passing of the bill by the lower chamber of Congress occurred after a long discussion. “In commissions and also in open speech, there was a deep debate,” he said. However, president Obrador said Congress must “think for the people and not for the corporations.”
Moreover, opposing parties PAN, PRI and PRD debated for hours; arguing that the reform would spark tension within the USMCA accord, and also it would rise electric bills to consumers; and also provoke environmental harm. Nevertheless, the bill was approved for its next debate in higher chamber of Congress.
Finally, Mier assured that the bill will not undermine any USMCA contracts; that it would not create a monopoly around Federal Electricity Commission (CFE); and that it would not revoke any private permits; “they will keep participating in the electric wholesale market.”
