MEXICO Law and Practice Contributed by: Bernardo Cortés and Fernando Quesada, Cortés Quesada Abogados, S.C.
These instruments now provide guidance on the new legal and institutional framework for the electricity industry, defining operational, technical and proce- dural rules governing market participation, permitting and infrastructure development across the sector. Nevertheless, other administrative instruments con- tinue to require adjustment, implementation or har- monisation. These include the WEM market rules and operating provisions, as well as regulations on stor- age, distributed generation, inside-the-fence projects, and reinforcement and improvement of the NES. In addition, the government continues to promote mixed participation schemes between CFE and pri- vate investors through PLP and mixed investment structures, supported by the CFE Mixed Develop- ment Guidelines and the broader Mixed Participation Schemes Law. These policies are expected to shape the next generation of large-scale generation, trans- mission, marketing and storage projects in Mexico, particularly where CFE acts as anchor off-taker or equity participant. Following the issuance of the Migration Guidelines, holders of legacy self-supply and cogeneration pro- jects may now voluntarily migrate to the genera- tion and supply schemes recognised under the LSE through one of six migration modalities applicable to both generation companies and off-takers. The Migra- tion Guidelines also exempt migrating projects from the binding planning criteria otherwise applicable to new generation projects, while the accompanying Transmission Methodology establishes a new trans- mission tariff applicable to legacy projects electing to remain under the former legal regime, thereby creating a significant economic incentive to migrate. Further regulatory attention is nevertheless expected in relation to Clean Energy Certificates (CELs), long- term reliability contracts for storage systems, distrib- uted generation, and the remaining Market Rules and operating provisions necessary to complete the imple- mentation of the LSE. Together, these regulatory developments will shape the evolving landscape of the Mexican power sector and confirm how public and private stakeholders can
operate pursuant to the principles already enacted under the new regime. 1.8 Unique Aspects of the Power Industry Government business plans and public presenta- tions have shown that private investment in power infrastructure remains critical to meet the country’s increasing demand. This is underscored by the country’s strategic position as a nearshoring invest- ment destination, which continues to drive industrial growth, data centre development and manufacturing expansion, all of which require significant incremental electricity consumption and grid reliability. The government has announced a significant invest- ment strategy for the power sector through 2030, combining public, mixed and private participation. Under the National Electric System Strengthening and Expansion Plan (2025–2030), CFE is expected to invest to increase generation capacity through the addition of 22,674 MW, while private-sector participation is expected to contribute at least 6,400 MW, primarily from clean energy and renewable projects. In parallel, the government has announced a broader portfolio of mixed and private investment projects, with the objec- tive of incorporating up to 32 GW of additional genera- tion capacity by 2030, including renewable generation and storage systems developed either independently or in partnership with CFE. Transmission and distri- bution investments remain equally critical, including reinforcement of the National Transmission Grid and expansion of distribution infrastructure to support reli- ability, industrial growth and nearshoring demand. Much of the private-sector participation is expected to occur through mixed participation schemes with CFE, including PLP, mixed investment projects, renewable generation paired with storage, and reliability-linked infrastructure projects, rather than through the fully liberalised market structures that characterised the post-2013 regime. Recent government policy has also prioritised projects capable of entering commer- cial operation from 2027 onward, alongside simpli- fied self-consumption permitting and storage integra- tion mechanisms, as well as the voluntary migration of legacy self-supply and cogeneration projects to the schemes recognised under the LSE, reinforcing a model in which private investment is encouraged,
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