Victory for Mexican solar as court blocks ‘damaging’ policy changes – reports

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on reddit
Reddit
Share on email
Email
Image credit: Carl Campbell / Flickr

The past few days have brought a reprieve to Mexican renewables after a year of policy disputes with the new government, with much-lambasted policy changes now said to have been halted by the courts.

A federal judge in Mexico City overturned last Thursday rules that would have extended clean energy certificates meant for post-2014 renewable projects to legacy hydro and nuclear power plants, according to reports on El Financiero and other Mexican outlets in recent days.

The changes to the so-called CEL scheme, enacted by the government of Andrés Manuel López Obrador (commonly referred to under the AMLO acronym), had triggered a chorus of condemnation in renewable circles when they were put forward on 28 October this year.

On the same day, Mexican bodies for PV (ASOLMEX), wind (Amdee) and others said the inclusion of old hydro and nuclear in the CEL programme ignored the feedback from dozens of businesses and trade associations and breached “basic tenets” of the legislation protecting investors’ rights.

“[These changes] entail a fundamental shift in the legislative framework and cause direct economic damage to private [renewable] projects,” the associations said, as they vowed to mount a legal offensive to protect their rights before national and international court channels.

The pushback reportedly materialised a weeks later, when Bloomberg listed AES Corp, Enel, EDF, Cubico Sustainable Investments, Zuma Energía and Balam Fund as the renewable players supposedly suing AMLO’s administration and demanding a court-ordered injunction to the CEL changes.

Latest policy row as Mexican solar eyes free-market era

Contacted by PV Tech in the past few hours, Mexico’s Energy Ministry had not shed light on the steps it will follow with its proposed CEL reform, after the court’s blocking, by the time this article was published.

The CEL system, part of the energy reform enacted by AMLO’s predecessor Enrique Peña Nieto, assigns a certificate to every 1MWh of output from a clean energy project. Developers and other market operators can then buy and sell the CEL units to underpin project revenues.

ASOLMEX, Amdee and other government critics have long argued that bringing legacy hydro and nuclear into the CEL scope could trigger a collapse in the overall value of these certificates, in the process majorly denting the financial viability of new PV and wind projects.

The conflict is the latest to pit Mexico’s renewable players against the AMLO administration, which in its first year in office has halted renewable auctions, shielded state monopoly CFE against old renewable purchases and axed key energy infrastructure projects.

The new president’s determination to ensure Mexico taps into its oil reserves – with talk of a US$8bn new refinery meant to make the country self-sufficient on the energy front – has seen the government scolded by the UN ahead of this month’s annual global climate talks.

The various policy rows have followed one another as on the ground, foreign players continue their work to deploy utility-scale projects. The latest milestones include Enel’s operational launch of 220MW Magdalena II – the firm’s first to be fully bifacial – and FRV’s merchant 396MWdc project.

A feature examining the opportunities and risks of Brazilian and Mexican PV was part of PV Tech Power's Volume 20, which you can subscribe to here.

The prospects and challenges of Latin American solar and storage will take centre stage at Solar Media's Energy Storage Latin America, to be held in Colombia on 28-29 April 2020.

Read Next

August 24, 2021
Energy advisory DNV has acquired the consulting arm of Chile-based energy price forecaster Antuko, taking aim at the Latin America and Iberia power markets.
July 26, 2021
Meyer Burger is considering its legal options after long-time heterojunction tandem solar cell manufacturing partner Oxford PV ended its collaboration agreement unexpectedly.
PV Tech Premium
July 14, 2021
Reforms in energy policy since the election of Andrés Manuel López Obrador have led to increased uncertainty for solar developers in Mexico, with renewables auctions cancelled and changes to power dispatch priorities proposed. Alice Grundy looks at how the market can move forward once again.
July 12, 2021
Elon Musk and Tesla’s court case regarding its acquisition of solar installer SolarCity has got underway in the US this week, with shareholders of the energy and automotive company alleging that fiduciary duties were breached when the deal was agreed.
June 15, 2021
Everwood Capital and the Prodiel Group have combined to create DVP Solar, a joint-venture (JV) focused on developing large-scale international photovoltaic projects, with gigawatts at various stages of development.
June 14, 2021
Asia boasts a growing number of markets with solar development pipelines in excess of 1GW, a new report by Fitch has found, with the region dominating the consultancy’s project database analysis this year.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
October 6, 2021
Solar Media Events
October 19, 2021
BRISTOL, UK
Solar Media Events
December 1, 2021