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Judge suspends policy that puts brakes on renewables; SENER to fight it

Energy Ministry policy poses a threat to free economic competition, judge rules

A federal judge has issued a suspension order against a new energy policy that seeks to consolidate control of the electricity market in the state-owned Federal Electricity Commission and limit the participation of renewable energy companies.

But just hours after the ruling was handed down on Thursday, the federal Energy Ministry (Sener) said it would challenge it.

That declaration came after Judge Rodrigo de la Peza granted a definitive suspension against the policy published May 15  to Defensa Colectiva, an independent advocacy group.

The policy imposes restrictive measures on the renewable energy sector such as limiting the number of permits that can be issued for new wind and solar projects and prohibiting their construction in parts of the country where there are already a large number of renewable plants.

In his ruling, De la Peza said that “by establishing entry barriers to the wholesale electricity market,” the policy posed a threat to free economic competition.

While the policy hinders the entry of new renewable projects to the electricity market, it allows for an “anti-competitive strengthening” of plants that generate power using fossil fuels, the judge said.

In contrast to wind and solar projects, fossil fuel-powered plants “will be able to enter into operation and remain in the market, … at least with greater ease,” de la Peza said.

His suspension order is the second issued against the Sener policy. Greenpeace was granted a provisional suspension order and is awaiting a decision on its request for a definitive one.

After the suspension order was issued on Thursday, Sener announced that it would fight the ruling, asserting in a statement that economic rights would not be allowed to take precedence over the interests of the country.

“No economic right will prevail over the general interest and that of the nation when it affects the reliable supply of electricity,”  Sener said.

Electricity is a “necessary” and “strategic” service with national security implications “that the state must guarantee for all Mexicans,” it said.

The ministry also said that the state has an exclusive constitutional right to make plans for and control the national electricity system. The new policy establishes technical criteria that allow all energy generation methods to be incorporated into the national grid, including renewable ones, Sener said.

The new policy will provide certainty to projects that comply with the criteria it establishes, it said.

Prior to the publication of the new policy, the National Energy Control Center (Cenace) suspended national grid trials for renewable energy projects under the pretext that the reliability of supply had to be guaranteed during the coronavirus crisis.

Suspension orders have also been issued against that decision but Cenace has indicated that it will launch legal challenges against them.

Source: El Universal (sp) 

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