Mexico will not meet its clean energy goals for another 13 years. An official document from the Ministry of Energy published this week shows that the country has already fallen short of the goals for 2021 and will miss the 2024 goal. The misses will continue for more than a decade. The Government blames the pandemic and a “legal paralysis” caused by companies. It does not mention that, for the sake of so-called “energy sovereignty”, the authorities have stopped the entry into operation of new plants, have closed investment channels and have promoted initiatives to privilege the plants of the Federal Electricity Commission (CFE), whether or not they are more polluting.
The country, a signatory to the Paris Agreement, is on track to fail to meet all the short- and medium-term goals set in the Energy Transition Law. By 2018, the goal was to have 25% clean energy out of total generation; 30% by 2021; and 35% for 2024. In 2018, it was 2.5 points below and in 2021, 0.5 points. In 2024 it will not be fulfilled either, falling 4 points short, according to the Program for the Development of the National Electric System (Prodesen). The 2024 goal will be achieved in 2031, which gives an idea of the size of the lag. After closing the gap in 2021, the default gap will widen in the coming years. Clean generation will only converge with the goals in 2035, according to a graph from Prodesen.
Wind energy looks practically stagnant. In 2021, it only added 1,372 GWh in generation, compared to 2,976 in 2020 and 4,291 in 2019. Solar did somewhat better, although growth is still lower than in previous years. In 2021, it generated 4,359 GWh more, compared to 5,871 in 2020 and 6,753 in 2019. The slowdown in both renewable sources coincides with the cancellation by this Government of the auctions through which the CFE bought energy at low prices from power plants. private. This mechanism fueled the investment boom in the renewable sector. If the pace of previous years had continued, it was expected that at least the 2021 goal would have been met.
To the drought of new private investments is added the scarce renewable commitment of the Government. In the first three years of the six-year term of Andrés Manuel López Obrador, the state-owned company did not launch any new renewable project; it only rehabilitated 10 existing hydroelectric plants to boost their generation. The expert Víctor Ramírez considers that this has been insufficient. “What has been tendered to modernize hydroelectric plants is about 240 MW. For the State of Hidalgo alone, the Government has denied permits for 1,000 MW of photovoltaic capacity,” he points out. In addition, the CFE’s business plan from 2022 to 2026 focuses on the construction of 14 combined cycle plants, although a solar plant already appears, the largest in Latin America, whose first phase would come into operation this year.
The Government hides behind the “negative impact” of the pandemic to explain the failure to meet the 2021 goal. It also mentions “the deferral of the date of entry into operation” of some plants, both public and private, and the “legal paralysis of sectoral planning instruments”. The companies have filed hundreds of injunctions to stop some legal and regulatory changes that sought to marginalize private power plants. According to the Government, these actions have prevented the “safe incorporation” of renewable plants.
In reality, the Executive has tried in recent years to modify the energy model so that the CFE plants dispatch before the private ones, and has blocked the granting of permits. “It has been the Government itself that has paralyzed the entry of plants. There is more than 1 GW of private installed capacity ready to operate. It is a matter of carrying out operational tests,” says Ramírez, spokesperson for the Mexico, Climate and Energy Platform. A particular renewable would upload its electricity to the network after a state-owned thermoelectric plant, according to an initiative to reform the law approved in Congress last year.
These changes remain suspended in the ordinary courts. However, a recent Supreme Court decision has upheld the constitutionality of the law. The Government defends that this will allow the incorporation of energy from hydroelectric, geothermal and nuclear power plants that were not being dispatched due to their high production costs. The danger, point out environmental organizations and analysis centers, is that with the new order of priority, private, clean and cheap renewable power plants are left out.
Beyond the 2021 goal, the Government acknowledges in the document that the 2024 goal is not “feasible” either. It considers it economically and technically unfeasible to integrate so much clean generation in that period. The Executive declares that its priority is the projects “instructed for the reliability and continuity of the electrical supply” and not “the disorderly and expensive connection of intermittent generation”. By “reliable” plants, the authorities understand non-renewable plants, mainly from the CFE, which can ensure an uninterrupted supply, whether they are combined cycle or thermoelectric.
Despite the prayer in the clean energy goals, the Government ensures that the emission reduction objectives will be met. With the Paris Agreement, Mexico promised to cut them by 22% by 2030. Prodesen points out that since 2020 the production of polluting gases by the electricity sector has been below the maximum set in the goals and that it will continue to do so. the next decade. The phenomenon is more a product of the economic closure caused by the pandemic than of a State policy. In addition, the figures do not include emissions from self-supply plants, which represent 12% of generation. On the other hand, although the goals are not breached, emissions will grow steadily until 2030, the last year that appears in the analysis.
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