MEXICO Law and Practice Contributed by: Bernardo Cortés and Fernando Quesada, Cortés Quesada Abogados, S.C.
4. Transmission Lines and Associated Facilities 4.1 Constructing and Operating Transmission Lines and Associated Facilities The construction and operation of transmission lines is governed by the LSE, the LPTE and the LGEEPA. These statutes also regulate associated facilities, such as energy storage equipment associated with trans- mission activities, particularly where storage systems support reliability, congestion management or reserve capacity obligations within the NES. Transmission services are exclusively reserved to the Mexican State, through CFE. CFE must comply with the General Administrative Provisions on open access and terms of service for transmission and distribution services, as approved by the CNE, and also with the binding planning directives issued by SENER under PLADESE. Nevertheless, the LSE and LCFE allow private sector involvement in the construction, installation, financ- ing and improvement of the National Transmission Grid (NTG). In particular, the LCFE provides that CFE may create joint ventures with private entities for the development of the NTG, and the RLSE expressly recognise mixed participation schemes for strategic infrastructure projects where CFE retains control and transmission services remain under State ownership. These structures have become increasingly relevant as the government prioritises grid reinforcement to support nearshoring demand, renewable integration and storage deployment. Private market participants, including generators, exporters, importers and consumers, are allowed to construct and operate private lines for specific uses, such as onsite delivery, interconnection and connec- tion to the grid. These private lines are not considered part of the NTG and are therefore not subject to open access rules. However, the provision of transmission services to third parties via such lines is expressly pro- hibited, and such infrastructure must remain limited to private use, self-consumption schemes or project- specific operational needs.
Land use and occupation for hydroelectric and geo- thermal power plants follow a predetermined process established in the LSE for both private and agrarian land. This process includes mandatory filings and requirements for compensation and payments based on the value of the land. The LSE also identifies types of real estate rights avail- able for generation projects, including private owner- ship, lease, easements and usufruct rights. 3.5 Decommissioning a Generation Facility PLADESE includes a dedicated section on the decom- missioning of generation facilities. Given the binding nature of PLADESE, decommissioning must proceed in accordance with the requirements provided there- under, including consistency with system reliability, capacity planning and infrastructure replacement needs. Generators are also required to notify CENACE of the decommissioning of the generation assets within one year prior to the effective decommissioning date. Importantly, decommissioning is not permitted for power stations still participating in capacity transac- tions with binding obligations. CENACE will assess whether the facility plays a role in system reliability. If it does, CENACE notifies the CNE to obtain approval to perform a capacity auction, in which the generator is obliged to participate. Environmental authorities may also impose require- ments for insurance or financial guarantees to ensure that decommissioning activities comply with the con- ditions imposed on site remediation, including waste management. Such obligations may include the dis- mantling of infrastructure, the restoration of affected land, the handling of hazardous materials and long- term environmental monitoring. SENER may also determine specific social commitments upon decom- missioning, particularly in projects located in sensitive or community-affected areas.
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