Renewable Energy in Mexico

Written by Ben-Zion Ptashnik

Mexico is on the verge of a solar and wind energy revolution, similar to the growth of these technologies in Europe, China, Japan and North America, where state-sponsored subsidies and favourable regulations have advanced the solar and wind energy industries to significant levels. Renewable energies have become major players in the advanced industrial states, carving a strong niche out of the multi-trillion dollar energy-sector: European countries such as Germany, Denmark and Spain are well on their way to eliminating dependence on gas and other fossil fuels for producing electricity, while creating “green jobs”. Denmark has not only become self-sufficient in electricity, but this small country of six million is now the world’s largest producer of wind turbines thanks to government policies aimed at energy-sustainability, and to carbon reduction policies born from public concerns regarding global climate change caused by the burning of fossil fuels.

It is expected that newly emerging industrial nations such as Mexico, Brazil, India and China, will also inevitably shed their dependence on fossil fuels, and will embrace the fountains of free and limitless sun and wind energies. This transition will take time. Many emerging industrial nations feel that they must first grow their economies and catch up with the developed industrial states, and later worry about their “carbon footprint”. In fact China is commissioning a new coal-burning plant every week. In Mexico, the energy ministers were always chosen from PEMEX, the national petroleum monopoly, and so naturally much of the energy policy momentum for decades has focused on petroleum and natural gas plants to produce electricity. President Calderon was the first exception when he was appointed Energy minister during the Fox administration. There are still those within the CFE bureaucracy and governmental agencies who are promoting nuclear and coal to replace oil and gas.

Mexico is particularly well endowed with immense sun and wind resources. Mexico is rated the third best country on Earth for potential solar production, and there are great wind resources throughout the Republic. Mexico now has wind farms in Oaxaca and Baja California, and one solar park in Aguascalientes. Thousands of solar photovoltaic systems that produce electricity have been installed all over Mexico in homes and businesses, and many tens of thousands of solar hot water boilers are now in operation here. It should be recognized that a paradigm shift to renewable energy is a slow process, and will require great effort and promotion from the private sector and from the environmentalist community.

It is worth noting that in the USA a thirty-year struggle between alternative energy advocates and private oil, gas and coal energy companies has markedly slowed down progress towards energy sustainability. Mexico now has net metering throughout the Republic, while ten States in the USA still do not have regulations allowing home power producers to connect their solar or wind system to the electric grid. In 2010 lobbyists from the fossil-fuel industries managed to torpedo efforts in Congress at legislation promoting renewable energy and carbon reduction.

So Mexico is making relatively great progress in a short time, and has begun the climb out of its dependence on fossil fuels with government energy-sector policies and goals aimed at promoting renewable energy. Mexico’s accelerated commitment to solar and wind made a leap forward with the signing of a new Energy Law in 2008, permitting consumers and businesses to sell power to the grid for credit.

This coincided with the announcement that Mexico’s largest oil reserve, the Cantarel oil field in Campeche, had depleted by over 35%. Mexico’s electric power grid is dependent for 74% of its electricity production on gas and oil, and recently Mexico has become a net importer of gas (40% is now imported from the USA). As fossil-fuel resources diminish it is inevitable that Mexico will be compelled to move inexorably to renewable energy.