US talks with Mexico over climate and clean energy were very constructive, said the US climate envoy John Kerry, on Wednesday. The meeting was part of Washington’s mounting pressure on Mexico after planned reforms have alarmed foreign investors and environmentalists alike.
Firstly, as we have reported previously, Mexican President Andres Manuel Lopez Obrador pushed a bill last year boosting the state’s role in the energy industry; a move that favors dirtier energy over renewables.
The meeting happened in the Mexican capital, where Kerry said the country could “play a vital, extraordinary role” in efforts to tackle the climate crisis. He also commented. “Mexico is blessed with assets that many other countries don’t have; great wind, great sun, geothermal, hydro, and fossil fuels.” He told reporters.
Moreover, he ensured that the US wants to do this work with Mexico “in a way that will strengthen… the ability of the marketplace to be able to be open and competitive.” As outlined above, the reforms in Mexico will favor the state-owned utility CFE as the main electricity provider.
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For the Mexican president, strengthening the state-owned company is a means to an end; rolling back the effects of liberalization that the leftist president says favored private companies. However, the reforms have sparked warnings that Mexico is in danger of violating its commitments under the USMCA.
As a result of the pressure, and a backlash from the US, Canada, and foreign investors; Lopez Obrador’s ruling party pushed back its deadline for the approval of the reform bill until April. The Mexican government says the reforms would prevent soaring power prices and tackle corruption.
Nevertheless, Kerry said he expressed his concerns to the president. To “not run up against the USMCA; that it’s important to have reforms that will not act as a hindrance to an open and competitive market.” He also added. “The key… is attracting investment and participation.”
Finally, Kerry said he and Mexican Foreign Minister Marcelo Ebrard would work together over the next four to five weeks to see what kind of plan could be crafted that is “sensible for major renewable energy deployment, and as fast as possible.”
