Tuesday, June 18, 2024

Environmentalists challenge limits on renewable energy firms

Two environmental groups have initiated legal action against federal measures that seek to limit the participation of private renewable energy companies in the electricity market.

The Mexican Center for Environmental Law (Cemda) and Greenpeace filed complaints against measures announced by the National Energy Control Center (Cenace) that suspended national grid trials for wind and solar projects.

Renewable energy companies are required to complete the trials before they can sell power to the Federal Electricity Commission (CFE).

According to federal judiciary records, injunction requests filed by Cemda and Greenpeace also challenge a new energy policy published by the federal Energy Ministry (Sener) on May 15. The policy imposes restrictive measures for the renewable energy sector that could effectively prevent its expansion in Mexico and consolidate control of electrical power in the state-owned CFE.

Several private energy companies have already successfully challenged the Cenace measures, winning more than a dozen suspension orders against them, but none have yet taken legal action against the Sener policy.

Cemda and Greenpeace argue that Sener does not have the legal authority to enforce a policy related to regulations and reliability of the national electricity system. They say that the Energy Regulatory Commission (CRE) may have improperly delegated the responsibility to the Energy Ministry.

An administrative court judge said today that she was unable to make a ruling on the requests and referred them to a court that specializes in economic competition matters.

Earlier this week, a federal court judge granted 13 definitive suspension orders against the Cenace measures to an equal number of companies.

In his rulings, Judge Rodrigo de la Peza López Figueroa said that delaying or preventing the entry into operation of renewable energy projects would have a serious adverse effect on society. He said that the Cenace measures alter the functioning of the electricity market, pushing it more towards a monopoly than one in which there is free competition.

That could cause electricity rates to go up and make the system less efficient, de la Peza said.

As things now stand, the companies that successfully challenged the measures – among which are Kenergreen, FV Mexsolar XI y Dolores Wind – will be able to carry out pre-operational national grid trials.

However, Cenace said last week that it would challenge all of the suspension orders granted against its measures, which also include ramping up energy generation at old CFE plants using surplus fuel oil produced by Pemex in order “to improve the reliability of the electricity system” during the coronavirus crisis.

Cenace on Monday filed its first challenge against one provisional suspension order that was issued last week but a federal court said it wouldn’t consider it because it didn’t receive it before the established deadline.

The legal battles between Cenace and renewable energy companies, and between the environmental groups and the federal government more broadly, are likely to last for months.

The director of the Federal Electricity Commission has vowed to put an end to “simulation and fraud” committed by renewable energy firms at the expense of the state-owned company.

Manuel Bartlett said the CFE has filed complaints against renewable energy firms with the CRE because they don’t pay for using the state-owned company’s transmission lines and backup power and have entered into “simulated” partnerships with other private companies.

In response to his remarks, the Confederation of Industrial Chambers denied that private energy companies are getting a free ride.

The Cenace measures and Sener policy are part of President López Obrador’s broader plan to “rescue” the CFE and the state oil company, Pemex, by increasing the participation of the state in the energy sector and limiting that of private and foreign companies that were allowed in as a result of the former government’s 2014 energy reform.

Source: Reforma (sp), El Sol de México (sp), Milenio (sp) 

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