Mexico gives green energy rules, geothermal updates

Friday, February 27, 2015

Mexico's energy ministry (Sener) will next month announce the green energy requirements that companies and other users must meet, rules which will "guarantee" that 35% of electricity is generated from renewables by 2024.

Energy minister Pedro Joaquín Coldwell (pictured) made the announcement at a Mexico City wind power conference during which he also said that the results of the country's geothermal "round zero" would be published in July.

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Businesses and other consumers will be required to comply with the green power rules by 2018, Joaquín Coldwell said.

Round zero will determine which projects will be developed by state power company CFE and which ones will be put out to tender to the private sector.

CFE may also form alliances with the private sector to increase the country's renewable generation capacity.

Mexico's geothermal production potential is greater than what Sener and CFE forecast, Iceland firm Reykjavik Geothermal's strategy director Chris McCormick said at an energy forum in Mexico City this month.

Geothermal development in the country has been slow in the past because it is a capital-intensive energy source to exploit and the CFE has not been able to allocate funds to the sector, but this will change under the energy reforms, he added.

Luis Carlos Gutiérrez Negrín, president of the Mexican geothermal association (AGM), said in January the sector would grow 40% by 2020 to surpass 1,400MW via US$1.6bn in investment.

In June the national energy control center (Cenace) is also due to publish Mexico's electricity grid expansion program. This is the roadmap to be followed for the augmentation of the country's transmission and distribution network. It will take the shape of a wholesale market in which private firms will compete with state power utility CFE.

In recent days, Sener announced the release of proposed guidelines to establish a wholesale electricity market as part of the country's energy reform.

BNamericas will host its 3rd Mexico Oil & Gas Summit on April 15-16, and its 3rd Mexico Electric Power Summit on May 13-14, both in Mexico City.