Steel chamber challenges Mexico's renewable energy law

Mexico's steel chamber Canacero launched a legal challenge against the country's energy transition law (ETL).

The law, approved in December, requires 25% of electricity to come from renewable sources by 2018, rising to 60% by 2050.

The Canacero amparo, or legal challenge, says the law violates principles of Mexico's constitution and will undermine steelmakers' competitiveness.

Steel producers Altos Hornos de México (Ahmsa) and DeAcero have already launched proceedings against the ETL, with the CTM union also planning a challenge, local press reported earlier in February.

Canacero previously criticized the law, which it says will lead to higher energy prices and substantial fines for companies unable to meet the obligations.

DISPROPORTIONAL

The ETL is disproportional compared with renewable energy commitments in competitor countries such as China and the US, which are responsible for far more carbon emissions, the chamber said.

It will put Mexico at a competitive disadvantage against other steel producing countries and impede economic development.

Steelmakers in the country have already invested more than US$5.00bn in environmental improvements in the past five years, Canacero said.

Mexico's steel sector is already facing the challenge of low prices linked to Chinese overcapacity, and dumping, with the Asian country seen as a main culprit.

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