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56 multinational companies: electricity reform initiative reduces competitiveness

A total of 56 multinational companies affiliated to the Executive Council of Global Companies (CEEG) spoke out against the presidential initiative for electricity reform in Mexico.

President Andrés Manuel López Obrador already presented this Friday a constitutional reform initiative for the electricity industry in which he proposes that the Federal Electricity Commission (CFE) generate at least 54% of the national electricity consumption.

According to the International Energy Agency, Mexico’s population is expected to grow to more than 150 million by 2050, which will greatly increase the demand for energy.

The industrial and commercial sectors account for 72% of electricity demand, representing the greatest opportunity for US exports given the need to reduce energy costs and improve energy efficiency.

However, according to the US government, it is necessary to consider recent political developments that impact the type of projects that are most likely to be executed in the future.

Multinational companies

If approved in its terms by the legislature, according to the CEEG, the proposed reform would increase the costs of electricity rates, both for families and companies, and would limit access to affordable, safe, sustainable and sufficient energy, essential for the industrial, social and economic development of the country.

“In addition, the proposal goes in the opposite direction to international efforts in the field of clean and renewable energies, which takes us away from an orderly and determined energy transition, so necessary in the current context,” the CEEG said in a statement.

The CEEG is a body founded in 2004 that is made up of 56 multinational companies with a presence in Mexico, and brings together their presidents and CEOs in order to build a continuous dialogue with the government, business organizations, civil society, opinion leaders and academics to seek solutions to make Mexico a more competitive, productive and equitable country.

“With the elimination of the CRE and the CNH, and the transfer of CENACE to the CFE, not only is the institutional design of the energy sector altered, but a serious precedent is imposed for the disappearance of other autonomous regulatory bodies,” CEEG added.

“The 56 global companies that are part of the CEEG respectfully invite the Government of Mexico to reconsider its position on the initiative to reform the electricity industry,” CEEG concluded.

 

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