BASHAM NEWS

Bill of Amendments to the Electricity Industry Law.

Mexico City, February 3rd, 2021.

 

On February 01st, 2021, Mexican President sent to the Federal Congress a bill of amendments to the Electricity Industry Law. The bill was submitted under the preferential scheme provided by the Federal Constitution which allows the President to request Congress a preferential and expenditure procedure to discuss and, in any case, approve, up to two presidential bills.

Among the most relevant amendments proposed and included on the referred bill are:

1.Electric energy produced by power plants should be dispatched in the following priority order: (i) from hydroelectric plants; (ii) from other plants property of the State-Owned Company, Federal Electric Commission (“CFE"); (iii) from wind and photovoltaic plants owned by private individuals or entities; (iv) from combined cycle plants owned by private individuals or entities.

2.Permits referred and regulated under the Electricity Industry Law must be subject to the National Electric System Planning Criteria issued by the Energy Ministry.

3.Issuance of clean energy certificates (“CEL´s” for their acronym in Spanish) will not rely on the ownership or commercial operation date of the power plants.

4.Obligation for CFE Basic Supply to purchase electric energy through the electric auctions previously called by the National Centre of Energy Control (“CENACE” for its acronym in Spanish) is deleted.

5.Opens the possibility for the Energy Regulatory Commission (“CRE” for its acronym in Spanish) to revoke the self-supply permits, including their amendments whenever same had been obtained by means of fraudulent acts.

6.Proposes the revision of the legality and profitability for the Federal Government in connection with: (i) the Commitment Agreements for Electric Energy Generation Capacity; and (ii) Electric Energy Purchase and Sale Agreements.

The preferential bill of amendments referred herein must be discussed, at first instance, in the Chamber of Deputies within the next 31 natural days and, subsequently, must be analyzed, discussed, and voted within a same timeframe by the Mexican Senate.

The proposed bill of amendments has already raised numerous opinions against its content and the repercussions it could have if approved by Congress.

 

The lawyers of the energy, infrastructure and administrative area at firm are available for any questions or comments on the above.

 

 

S I N C E R E L Y,

 

Juan Carlos Serra

serra@basham.com.mx

 

Rodolfo Barreda

rbarreda@basham.com.mx

 

Jorge Eduardo Escobedo

jescobedo@basham.com.mx

 

Fernando Morayta

fmorayta@basham.com.mx