Mexico publishes power market rules

New rules governing Mexico's wholesale power sector are designed to promote competition and drive down prices, energy minister Pedro Joaquín Coldwell said on Tuesday.

Mexico's energy ministry published its long-awaited power market regulations on Tuesday, the latest development in the country's landmark energy reform process.

The announcement paves the way for investors to participate in bidding processes for new projects, the first of which is scheduled to begin next month.

According to Coldwell, the guidelines represent a "vigorous shaking up" of the sector.

"These regulations are the instrument to promote competition," Coldwell said during a presentation. "Generators will have to offer their best prices, which will result in lower [consumer] tariffs."

"The reforms we are implementing are a vigorous shaking up of Mexico's old electricity system, in which everything was concentrated in one single body. Operations will now be spread among many companies, creating balance in the electricity supply."

The wholesale power market will be operated by independent body Cenace. Transmission and distribution infrastructure will remain public property, while the new regulations will allow state utility CFE to partner with the private sector to develop projects.

Meanwhile, government officials from Mexico and the US state of Texas have agreed to set up a working group to discuss joint energy projects.

In a statement, Mexico's energy ministry said the move aimed to facilitate dialogue and cooperation in the electric power and gas infrastructure segments.