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President Sheinbaum reverses Mexico’s 2013 energy reform

Mexico City, Mexico — President Claudia Sheinbaum Pardo signed a set of secondary laws of the constitutional reform on energy matters. The secondary laws reverse the modifications made in 2013 by former President Enrique Peña Nieto.

Sheinbaum says the reversal strengthens the Federal Electricity Commission (CFE) and Petróleos Mexicanos (Pemex) as public companies of the State, which will allow them to be more efficient and transparent, governed by the principle of Republican Austerity.

“It is, let’s say, a reversal of Peña Nieto’s 2013 reform, the objective of which was to privatize. In fact, it is a reversal, even, of reforms to the secondary laws of 1992.

“The public sense of CFE and Pemex is recovered as guarantors of the provision of energy for the people of Mexico and as guarantors of national sovereignty. A part of private production is maintained, but public companies are strengthened.

“These laws are something very important, transcendent, historic,” she explained.

Sheinbaum says the secondary laws will allow compliance with the Mexico Plan, since there will be greater availability of energy and clear mechanisms for public financing and the participation of private investment.

President Sheinbaum considers it a historic Investment Plan for the CFE with $23.4 billion USD to strengthen the generation, transmission and distribution of electricity in Mexico.

These are the Law of the State Public Company, Petróleos Mexicanos, the Law of the State Public Company, Federal Electricity Commission, the Law of Planning and Energy Transition, the Law of the Electric Sector, the Law of the Hydrocarbon Sector and the Law of the National Energy Commission.

President Sheinbaum reverses Mexico's 2013 energy reform

“It is a very profound reform which we are very pleased with because we are giving viability to the country in the future, to the people of Mexico, and the guarantee of energy justice and at the same time, the guarantee that there is sufficient energy at affordable costs for the development of the country,” she said.

According to Sheinbaum, as part of the reforms, in the case of CFE, there is already an estimated Investment Plan until 2030, which projects an estimated investment of $23.4 billion dollars of which $12.3 billion will be for the generation of 13,000 megawatts, $7.5 billion dollars for transmission and $3.6 billion dollars for distribution.

“There will be enough electricity and the transmission of that electricity for the development of the country.”

Energy Secretary Luz Elena González Escobar said the package of secondary laws represents a decisive step in consolidating the country’s sovereignty and benefits the people of Mexico.

“They are the missing foundation to guarantee a strong, reliable, sustainable energy sector, but with national sovereignty and social justice at its core,” he added.

“The reform allows Pemex and CFE to be reintegrated horizontally and vertically, ending the absurd strict legal separation imposed by the 2013 reform, which hindered their efficient operation for the benefit of all Mexicans,” she said.

In addition, they are given a special regime for managing their budget, accounting, and debt with specific annual guidelines and goals.

The Electricity Sector Law, she explained, recognizes the essence of Pemex and CFE as guarantors of the continuity, accessibility, security, and reliability of the national electricity system and the provision of hydrocarbons and natural gas.

In the case of Pemex, preference is given to determine the areas of exploration and extraction as well as the possibility of deciding whether to associate with private parties in mixed contracts.

The Petroleum Law for Well-being is incorporated as a new tax regime. The national petrochemical industry is rescued, as is the production of free fertilizers and the traceability of hydrocarbons is improved, making the delivery of information from the entry of fuels to their distribution in gas stations mandatory.