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Weekly Report - 07 October 2021 (WR-21-40)

MEXICO: Electricity reform sparks fierce debate

Mexico’s President Andrés Manuel López Obrador took the plunge on 1 October and sent to congress a constitutional reform initiative designed to cast his stalled energy reform in stone. López Obrador signalled his intent several months ago when a deluge of legal challenges held up his government’s energy reform crafted to give the state-run electricity firm, Comisión Federal de Electricidad (CFE), a pre-eminent role in the domestic market to the detriment of private renewable energy generators. Hostilities resumed the second he sent congress a bill to enshrine the CFE’s controlling share of the market in the constitution. There is a lot at stake. Beyond money and energy sovereignty, the cost for domestic consumers, and the future of Mexico’s renewable energy industry, there is also the international perception of the government’s respect for environmental commitments and the rule of law.

The constitutional reform initiative President López Obrador sent to congress contains a series of amendments to several different articles. The most contentious of these would grant the CFE a 54% controlling share in the domestic electricity market.

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