Mexican utility giant to reopen power auction contracts

Facebook
Twitter
LinkedIn
Reddit
Email
CFE's Bartlett quotes Mexico's

Mexico’s Comisión Federal de Electricidad (CFE) has said it will reexamine the auction power purchase contracts it was “forced” to enter in recent years, in a bid to re-conquer the market with the backing of a new government.

“We’re revising the conditions in those contracts. It’s an aberration being forced to buy power from one’s competitors … being told we cannot generate our own power,” said Manuel Bartlett, CEO of the state-owned utility giant, at a recent meeting.

“We don’t agree with [buying contracts] and will seek to see it changed, amongst many other things. It’s a new government, a new vision, and we’ve got the right to review everything we think is worth reviewing,” Bartlett was quoted as saying, in reference to last year’s electoral victory by left-wing president Andrés Manuel López Obrador.

CFE: Wind and PV are ‘very expensive’

CFE’s CEO sought to stress the firm does not oppose a move to clean power. “I’ve been reading many claims that the CFE is pushing to carbonise the country as the world embraces renewables and it’s totally false,” he argued. “We use all necessary and renewable sources for our plants.”

At the meeting, Bartlett described wind and PV as “very expensive” but did not specify whether it is contracts with these technologies the CFE will seek to reopen. Under sweeping energy reforms by previous president Enrique Peña Nieto, the utility has in recent years had to buy tendered clean energy via a certificate scheme.

Some 1.8GW worth of solar purchases were assigned to CFE at a broader renewables auction in spring 2016. Contracts to Enel Green Power (992MW) and SunPower (509MW) helped solar dominate the auction, with predictions the industry would soar by 521% in that year alone.

Long-term PV outlook darkens amid auction delays

Progress with further tendering ground to a halt in recent months, with the latest auction – which would have been the fourth after tendering in 2015, 2016 and 2017 – cancelled last December and then this February. At the time, the government said it would have been “irresponsible” to add more capacity while already contracted projects are yet to be built.

In the weeks that followed, Wood Mackenzie consultants have said solar’s “progressing pipeline” will help keep the momentum in the short term despite the cancellation. However, they warned, policy inaction and investor unease could make the industry’s long-term outlook “murkier”.

See here for the full version of CFE's statement

15 September 2022
Bifacial PV modules will be the dominant solar PV technology globally within one or two years; in the utility-scale sector, their market share is already above 70%. This webinar will provide a clear view on the successful implementation of bifacial technology, maximizing system performance and minimising LCoE.
4 October 2022
Solar & Storage Finance USA, the only event that connects developers to capital and capital to solar and storage projects, will be back in November 2022.

Read Next

August 11, 2022
German project developer Energiequelle has entered the Polish renewables market with an eye on 30 projects with more than 1GW of capacity.
August 3, 2022
Spain has started the process to celebrate a fourth round of renewables auction in November with 1.8GW of solar capacity to accelerate its electrification.
August 2, 2022
Swiss PV module manufacturer Meyer Burger has slashed its production plans for 2022 and 2023, citing a “challenging supply chain environment” which has caused delays to its planned production capacity build out.
August 1, 2022
US utility CenterPoint Energy has sought approval from the Indiana Utility Regulation Commission (IURC) to acquire a 130MW solar PV project in Pike County, Indiana.
July 28, 2022
Enel Green Power has started construction of a solar PV park of 486.7MWdc in the northern department of Atlántico in Colombia.
July 28, 2022
Iberdrola has recorded a profit of €2.07 billion in H1 2022 with strong performances in its international business offsetting adverse results in Spain.

Subscribe to Newsletter

Upcoming Events

Upcoming Webinars
September 7, 2022
15:30 AEST (UTC +10)
Solar Media Events
September 14, 2022
London
Solar Media Events
October 4, 2022
New York, USA
Solar Media Events
October 11, 2022
Virtual event