Is the Mexican government reconciling with Iberdrola?

Mexican President Claudia Sheinbaum

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From pv magazine LatAm

Mexican President Claudia Sheinbaum said Tuesday that the return of the Spanish energy company Iberdrola to the country — from which it has never left — can only occur under the conditions of the new regulatory framework for the sector.

“This idea that Iberdrola enters as before, well, not necessarily. There will be room for private investment, but with certain rules,” said Sheinbaum, who stated that private companies will be able to invest in the electricity sector, but they must abide by “clear rules” that guarantee technical and operational stability.

“These rules have to do with the transmission of electricity, with what enters the system not generating technical problems, let's say it like that, and always that the public company [Federal Electricity Commission], which is the people of Mexico, will guarantee that it has at least 54% of the electricity generation,” she said.

Sheinbaum recalled that this policy comes from the previous mandate. “This was also proposed by President [Andrés Manuel] López Obrador. Today, with the purchase of the Iberdrola plants about three years ago, more or less, the state already produces 54% of the generation and we want it to stay that way.”

Pemex Losses

Mexico's constitutional reform returned the status of public companies to Pemex and the Federal Electricity Commission (CFE).

It was reported this week that in September, Pemex registered its second largest loss for a third quarter in its history, only behind the one registered in 2020, the year of the COVID pandemic.

The company reported a loss of MXN 161 billion ($8 million) due to exchange rate losses of more than MXN 130 billion as well as to lower sales and higher administrative costs.

Iberdrola

In February of last year, Iberdrola sold 8,539 MW of combined cycle gas and 103 MW of wind power for approximately $6 billion to private investment fund Mexico Infrastructure Partners, with operations under the CFE.

Also in August 2023, the Spanish energy company announced a billion-dollar investment plan in a photovoltaic project in the Mexican state of Nuevo León.

Energy Storage Batteries: A New Focus

According to the government, the approval of new regulations on energy storage batteries in the National Electric System (SEN) has led Iberdrola to identify business opportunities, so investments are also expected in that sector.

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