Program for the Development of the National Electric System 2022-2036
The new Program for the Development of the National Electric System (PRODESEN) 2022-2036 was presented in June 2022. It targets Mexico’s energy transition and its electricity market, comprising electricity supply, distribution, transmission, and consumption, with an outlook until 2036.Among the points of the program is the re-establishment of the state-owned Comisión Federal de la Electricidad (CFE) as the leading electricity producer in Mexico, by planning national power capacity additions of up to 55 gigawatts through the construction of power plants across the country. In 2021, Mexico’s electricity capacity amounted to 86 gigawatts, of which approximately 35 percent in renewable energy sources. According to PRODESEN 2022-2036, 16.6 gigawatts of power generating capacity will be installed by 2025 and 39.5 gigawatts between 2026 and 2036. In both fractions of the plan, around 50 percent of the additions will be based on clean energy sources, especially solar photovoltaics and wind energy. Nonetheless, the plan is criticized for including non-renewable energies with a large carbon footprint in a long-term plan of capacity additions.
Distributed generation is another point of the program, aiming at reaching remote communities, currently not connected to the national electricity grid.
Reforms of the electricity sector
Since the liberalization of the electricity sector with the 2014 Electric Industry Law, Mexico’s electricity market has been open to private competitors and foreign investments have been encouraged. After auctioning clean energy projects on the free market, Mexico’s renewable energy capacity doubled between 2014 and 2022.However, during the administration of President López Obrador, the 2021 amendment to the Electricity Law set the basis for restoring the state’s control over the energy sector and the nationalization of the market. In 2023, Mexico scored the lowest attractiveness for renewable energy investments among the largest Latin American economies: over the last few years, renewable energy auctions have been abolished to prioritize power production from the CFE over private companies, as outlined by PRODESEN 2022-2036. CFE was by far the energy company operating in Mexico with the largest revenue in 2022.
