The Electricity Industry law that involves reforming the electricity concession in Mexico, giving more strength to the state Federal Electricity Commission (CFE), in a clear nationalization of energy, is choking the Government of Andrés Manuel López Obrador. The president has defended the changes in twelve articles by which you are convinced do not contravene the Constitution. Two different expert judges in Economic Competition, Telecommunications and Broadcasting have paralyzed the law on electric power with a first stalemate that took effect just 24 hours after its promulgation. The new, and controversial, law will modify the electricity market by applying priority in the dispatch of energy to the Federal Commission over private and renewable companies and, in addition, will grant clean energy certificates to electricity companies prior to the 2014 reform when the Mexican public sector it possessed the power to exploit oil, gas, and electricity. In a third point, it will involve a reconsideration of the commitments that are detrimental to the State company.
The Ministry of Energy presented complaint resources to refute the first two provisional stoppages that have cut, for the moment, any type of reform. Given the current situation and the impotence of not being able to carry out his own law, the head of the executive branch has expressed his intention to modify the Constitution. Yes, because I cannot be an accessory to theft, robbery and I cannot allow individuals to affect the Public Treasury, the country’s economy and above all that they continue to harm the poorest;, urged the Government of López Obrador. The Director of Litigation of the Legal Affairs Unit of the Ministry of Energy, on behalf of the President of the Republic, will appear this Thursday before a hearing in which the definitive suspension will be resolved to eradicate all the effects of the new law until verifying whether the amparo is granted or not.
Only if after the elections on June 6, in which the 500 federal deputies will be elected, and for which the Morena presidential party would have to obtain a qualified majority, they will be able to access the modification of the Mexican Constitution to grant the safe conduct , so far denied to the Federal Electricity Commission.
One of those affected is Iberdrola México due to the rise in prices to access the transport and distribution network that belongs to the Government. The electricity company with an investment of one billion euros planned for last June has canceled them in the next five years. AMLO has referred to the company in his morning appearance, which he accuses of favorable treatment and having hired former President Felipe Calderón as a director, through its American subsidiary Avangrid. According to El Confidencial, the Spanish company has taken action on the matter with the hiring of the arbitration expert firm White & Case for which it has been granted protection of reciprocal investment protection treaties. Iberdrola is the largest private energy producer in Mexico, with 22 active projects in the country, including a plant in Veracruz with an injection of 1.2 billion dollars. López Obrador has assured that some ten foreign companies will have to renegotiate their contracts after their long-awaited reform.