By THE PULSE NEWS MEXICO STAFF
Mexican President Andrés Manuel López Obrador (AMLO) left no doubt on Monday, Oct. 10, as to which energy sources would be prioritized under his new electricity initiative.
During his daily morning press conference, AMLO had Energy Secretary Rocío Nahle read out the details of his proposed electricity reform, which, she said, would return control of all electricity generation and distribution to the state-run Federal Electricity Commission (CFE).
In addition, Nahle said, electricity generated from clean sources such as solar and wind energy, which are prioritized under the current government scheme, will now be considered as the last option, giving preference to electricity produced by carbon-based sources such as oil and coal.
Nahle later clarified that hydroelectric power plants and nuclear power plants, along with geothermal energy sources, would be given priority after carbon-based sources.
The reform, she said, will also nullify the CFE’s existing energy supply contracts, especially those that have a long reach.
“The CFE will control the dispatch of electricity and will be able to sell that electricity and obtain a higher income,” she said.
“And, as such, it will continue to guarantee electricity provisions for Mexico’s 46.2 million users, with a constant 24-hour source of energy at a low price.”
Nahle said, rather confusingly, that the initiative “would not constitute the creation of an electricity monopoly,” since all existing regulatory bodies would be eliminated so that the government can have sole discretion as to where and when it purchases private electricity, which could have a market share as high as 46 percent.
She pointed out that in the past, the CFE has paid more than 6 billion pesos a year to private companies for clean energy.
“The idea that clean private energy is cheap is simply not true,” she said, justifying the government’s decision to deprioritize it.
“If private companies want to do business, they can, but with reasonable profits, not major gains,” she said.
Nahle also warned that, if the president’s reform does not pass Congress, “private companies will end up taking over the entire electricity sector, like they have in Spain, where the cost of service is through the roof.”
The president’s electricity reform is being debated before the Mexican Congress, where AMLO’s leftist National Regeneration Movement (Morena) party does not currently have enough votes to ensure its passage.