Exclusive: Renewable firms in Mexico must contribute to grid backup - CFE chief




  • In Business
  • 2020-05-23 02:21:51Z
  • By Reuters
Exclusive: Renewable firms in Mexico must contribute to grid backup - CFE chief
Exclusive: Renewable firms in Mexico must contribute to grid backup - CFE chief  

By David Alire Garcia

MEXICO CITY (Reuters) - Private renewable energy firms in Mexico should pay for part of the baseload power underpinning the flow of electricity on the grid, the head of the state power company said on Friday, as a dispute on the future of the local industry roils the market.

Manuel Bartlett, director of the Comision Federal de Electricidad (CFE) and staunch defender of the state, told Reuters he favors more clean energy and wants to reduce Mexico's use of fuel oil as a major source of power generation.

But he said renewable operators had not been pulling their weight in contributing to the infrastructure that sustains them.

"Wind and photovoltaic (plants) don't pay the CFE for the backup," said Bartlett, referring to the cost of power generation from fossil fuels, mostly natural gas, to guarantee uninterrupted flow.

"Do you think it's fair for the CFE to subsidize these companies that don't produce power all day?" he asked.

The firms should also start helping to pay transmission costs, he said.

"That's not a free market, it's theft," said Bartlett, a close ally of President Andres Manuel Lopez Obrador, who has pledged to hold down electricity rates.

Renewable companies argue they can produce more efficiently than the CFE and help Mexico reduce its emissions.

Last month, Mexico's power grid regulator CENACE issued a ruling supported by Bartlett that prevented several dozen new renewable energy plants from connecting to the network.

CENACE cited the coronavirus pandemic as a justification, arguing that intermittent wind and solar power is not consistent with ensuring constant electricity supply.

Business associations said the move put more than $6 billion in renewable power plants scheduled to begin operating this year or next in limbo.

In a provisional ruling this week, a judge ordered CENACE to back down and allow the renewable firms to continue for now with tests needed to bring plants online.

Bartlett, an 84-year-old former interior minister who has been a force in Mexican politics for decades, said he is not seeking to restore CFE's decades-long monopoly that was ended by the previous government.

But he said Lopez Obrador has instructed him to ensure the CFE generates at least 54% of power output, its current level.

"I accept that there's going to be private investment."

Last Friday, the energy ministry moved aggressively to give the government more control over power supplies by seeking fast-tracked regulatory approval for a ruling designed to give the state more say over who can generate electricity and how much, again citing the pandemic as a rationale.

The move promoted the head of a government regulatory commission to abruptly resign.

Bartlett described the notion that the government is resisting more renewable energy as a "lie."

"We are not troglodytes, we're serious people," he said, adding that he favors cleaner-burning natural gas.

Nevertheless, the government last year canceled a planned auction to purchase renewable energy via long-term contracts, another policy promoted by the last government.

It also sought to disincentivize a clean-energy certificate scheme, arguing it put the CFE at a disadvantage.


(Reporting by David Alire Garcia; Additional reporting by Adriana Barrera; Editing by Marguerita Choy and Sonya Hepinstall)

COMMENTS

More Related News

Missing Mexican congresswoman
Missing Mexican congresswoman's body found a month after abduction
  • US
  • 2020-06-03 17:33:39Z

* Anel Bueno, 38, was snatched in Pacific coast town * Area important for drug cartels is country's murder capitalThe body of a missing Mexican congresswoman has been found in a shallow grave more than a month after she was abducted by armed men while raising awareness about the coronavirus pandemic.Anel Bueno, a 38-year-old lawmaker from the western state of Colima, was snatched on 29 April in Ixtlahuacán, a town on a stretch of Mexico's Pacific coast that the drug trade has made one of the country's most murderous regions.Mexico's President Andrés Manuel López Obrador told reporters on Wednesday a suspect had been detained over the killing of Bueno, who was a member of his party,...

Renewables surpass coal in US energy generation for first time in 130 years
Renewables surpass coal in US energy generation for first time in 130 years

'We are seeing the end of coal,' says analyst as energy source with biggest impact on climate crisis falls for sixth year in a rowSolar, wind and other renewable sources have toppled coal in energy generation in the United States for the first time in over 130 years, with the coronavirus pandemic accelerating a decline in coal that has profound implications for the climate crisis.Not since wood was the main source of American energy in the 19th century has a renewable resource been used more heavily than coal, but 2019 saw a historic reversal, according to US government figures.Coal consumption fell by 15%, down for the sixth year in a row, while renewables edged up by 1%. This meant...

Mexican president defies leftist label in virus response
Mexican president defies leftist label in virus response

When Andrés Manuel López Obrador won Mexico's presidency after years of agitating for change, many expected a transformative leader who would take the country to the left even as much of Latin America moved right. Instead, López Obrador is leading like a conservative in many ways - cutting spending, investing heavily in fossil fuel development and helping the U.S. crack down on the northbound flow of migrants. As coronavirus spreads through Mexico, the president known as AMLO has rejected widespread shutdowns and pressed to keep the economy going.

Mexico president kicks off
Mexico president kicks off 'new normal' phase amid pandemic

Amid a pandemic and the remnants of a tropical storm, Mexico President Andrés Manuel López Obrador kicked off Mexico's return to a "new normal" Monday with his first road trip in two months as the nation began to gradually ease some virus-inspired restrictions. López Obrador said he's taking all necessary precautions - he drove the 1,000 miles from Mexico City over the weekend rather than flying - on a trip to promote construction of one of his signature infrastructure projects the Mayan Train. While the federal government's nationwide social distancing rule formally ended Monday, it is urging people in so-called "red" zones to maintain most of those measures - and so many people are...

Rich world
Rich world's jobs crisis jolts money flows to millions
  • World
  • 2020-06-01 10:06:40Z

"It's been a very tough situation," said Sosa, who is in the middle of processing his U.S. residency papers. Lockdowns imposed by wealthy nations to slow the spread of the novel coronavirus, and the jolt those restrictions have delivered to their economies, are severing a vital lifeline for many often vulnerable people around the world: the billions of dollars in remittances sent home by relatives working abroad. Roughly one in nine of the global population receives remittances, or about 800 million people, according to the United Nations.

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business