Richard Montijo, SWCA Environmental Consultants

Evolution of an Energy
Regulatory Framework in
Mexico
Ricardo Montijo – SWCA Inc.
Mexico’s Early Energy
History
Economy and Energy, Surge of Transnationals, and Major Early Projects 1879 to 1937
Origins of Modern Energy and Economy
▪ Porfirio Diaz Presidency
▪ 1884-1911
▪ Controversial Figure with Notable
Accomplishments
▪ Internal Stability
▪ Modernizes the Economy
▪ Opens the Door to Foreign Investment
Photo Source: MexicoHistory.org
Early Energy History: 1879 to 1900
▪ Early Energy Need for Textile Plants and
Mines and Later for Agricultural Needs
▪ 1879 – First Generating Plant in Leon,
Guanajuato
▪ 1881 – Street Lights in Mexico City Mexicana de Gas y Luz Eléctrica
▪ 1889 – First Hydroelectric Dam in Batopilas,
Chihuahua
Rise of the Large Transnationals: Early 1900s
▪ In 1900, Mexico had a capacity of 31 MW
▪ 177 Generating Plants
▪ Mostly owned by interests foreign to Mexico
▪ Large Transnationals Begin to Emerge
▪ 1902 – Mexican Light and Power Co. Ltd.
Founded in 1898 in Canada.
▪ 1903 – Luz y Fuerza del Centro
Major Generation Projects
Necaxa Dam, Puebla
▪ Inaugurated in 1905
▪ Connection to the US
▪ Connection to California
▪ Relevance
Photos Sources: Electrical World and Engineer
New York, NY, United States, Saturday, October 28, 1905
vol. 46, no. 18, p. 729-735, col. 1- 2
Mexico en Fotos: http://www.mexicoenfotos.com/
Major Generation Projects
Boquilla Dam, Rio Concho, Chihuahua
▪ Completed in 1915
▪ Built by the French Canadian Firm
Bond and Sharp
▪ Still the largest dam in the state of
Chihuahua
▪ Produces 25 MW and has done so
without interruption for 105 years
Photos Source:
Mexico en Fotos: http://www.mexicoenfotos.com/
Continued Growth and Petroleum Implications
120
▪ A total of 165 MW of installed
electricity
100
▪ Throughout the Country
▪ Implications of Petroleum
Discovery and Development
▪ Foreign National Firms
▪ Mexican Constitution 1917
Generation Plants
▪ Over 100 Plants by 1911
80
60
40
20
0
1900
1905
1911
Investment by Country in Current US Dollars
In Millions of Dollars
400
350
300
Mexico
250
France
200
150
Canada
100
United States
50
0
1900
1910
1920
1924
1926
1928
1930
1934
1935
Source: The Mexican Electricity Sector: Economic, Legal and Political Issues
Victor Carreón and Armando Jimenez
The Rise and Evolution of
Mexican Energy
Institutions
Energy Institutions and Regulation 1937 to 1980’s
Initial Institutions and Regulation
▪ The Government Realizes the social, political and
economical relevance of the electricity supply industry
▪ National Commission of Motive Power
▪ National Electrical Code is Published
Civil Unrest and Expropriation
▪ Lazaro Cardenas (1934 – 1940)
▪ Expropriation of Foreign Energy Interests
▪ Creation of PEMEX
▪ Creates an Energy Law in 1937
Photo Source: MexicoHistory.org
CFE
▪ The Creation and operation of the CFE achieve:
▪ Rural Electrification in the 1940’s and1950’s
▪ Consolidation of Regional Monopolies and the
Mexican Electric Power System
▪ Eventual Nationalization of Electricity in the 1960’s
▪ The creation of a second entity called Luz y Fuerza
del Centro
State Monopoly and Installed Capacity
Evolution of the Modern
Regulatory Scheme
1980’s to Present
Reform
▪ Late 1980’s and 1990’s Reforms
▪ Electricity Law Reform of 1992
▪ CRE was created to serve as an
autonomous agency to regulate gas
and electricity
▪ Renewable Energy Law
▪ Energy Efficiency Law
▪ Pena Nieto Administration Reforms
Cultural, Social, and
Environmental
Implications
Towards Responsible Energy Reform
Over 10,000
26,071
▪ A little less than 1/5 of the
area of the US
▪ Almost 10,000 more species
▪ Ranks fifth in vascular plant
diversity
▪ Two percent are in danger of
extinction
200,000
*Accounts for 10 to 12 percent
of the world’s biodiversity
*1,150 birds
*502 mammals
*574 reptiles
*290 amphibians
11,000,000
Cultural, Social, and
Environmental
Commitment
Steps to Protecting Mexico’s Resources
Resource Protection Laws and Agencies
Ley General del Equilibrio
Ecologico y la Proteccion al
Ambiente (LGEEPA)
Laws that Protect Historic,
Archaeological and Paleontological
Resources
▪ SEMARNAT/ASEA
▪ INAH
▪ PROFEPA
▪ Other Related Agencies
▪ CONABIO
▪ CONAGUA
▪ Other Related Agencies
1.
Unconditional authorization of the project or
activity in question, as proposed, evaluated and
mitigated in the supporting MIA;
2.
Conditional
authorization
with
additional
measures that avoid, mitigate or compensate for
adverse environmental impacts; or,
Deadline for
Additional
Information
MIA
Request
Request for Evaluation
Working
Day
Public Working Day
50
Comments 10 to 60
Working
Day
File Integration and 10 to
20
Delivery to
SEMARNAT
Working Day 0 to 10
SEMARNAT
Decision
Deadline
Working Day
60
(SEMARNAT
may add an
additional 60
days for
complex
projects)
3.
Denial of the authorization when:
•
It contradicts Mexican law;
•
The work affects a protected species, or can lead to the
declaration of a species as threatened or endangered; or,
•
Information provided by the applicants misrepresents the
project and its associated impacts.
Gracias