Over the past two years, the government of Mexican President Andrés Manuel López Obrador has sought to strip away central aspects of the 2013 energy reform that increased private investment in the power sector and return control of the sector to state utility CFE. These moves will reduce needed investment in the sector and lead to higher electricity costs for Mexican industry and manufacturing, affecting employment, trade, and Mexico’s ability to meet its clean energy targets, according to this new report by the Inter-American Dialogue.
Until recently Mexico stood out within Latin America as a top potential producer of wind and solar energy, but policies under the López Obrador administration have made the climate for renewable energy investment increasingly hostile. Lisa Viscidi, director of the Energy Program, and Sarah Phillips, program assistant, sat down with Nathaniel Parish Flannery of Forbes to discuss what’s ahead for Mexico’s renewable resource sector.
Lisa Viscidi, Sarah Phillips, Nathaniel Parish Flannery
Long-term power supply auctions are an increasingly popular instrument worldwide for attracting renewable energy investment while cutting prices, increasing energy security, and reducing emissions. Latin America has been at the forefront of using auctions to boost renewable energy capacity. This study analyzes design and outcomes of government-led long-term power auctions with participation from non-conventional renewable sources in six countries in Latin America and the Caribbean (Brazil, Chile, Mexico, Argentina, Peru, and Jamaica) since 2015.
Lisa Viscidi, Ariel Yépez-García
˙ Inter-American Development Bank