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They fear a blow to investment with reform – Latest News, Breaking News, Top News Headlines

The reform to the Electrical Industry Law who will vote this Tuesday Chamber of Deputies It will scare away national and foreign investment, because it eliminates confidence in the rule of law in Mexico, specialists warned.

In addition, these modifications fix the stability of the National Electric System on the Federal Electricity Commission (CFE), when the company has shown that it lacks the resources and capacity to invest in technology.

“The biggest consequence is the confidence at the country level to continue investing in renewable technology and in general in the electricity sector. No one is going to want to invest in the country until there is a guarantee of a solid and firm rule of law, “he said. Paul Sánchez, Independent Energy Consultant.

The reform opinion incorporated a transitory article where it establishes that self-sufficiency permits that have been obtained “with fraud of the law” must be revoked. However, it is not yet clear under what criteria they will fall under this assumption.

“What they are doing is to specify, so that it is not so crude or so direct or explicit, the claims of unconstitutionality. What they did in the transitory room was add the theme of fraud of the lawTherefore, there is concern about retroactivity to the rights of permit holders. Who is going to determine what is fraud to the Law? ”, Questioned Sánchez.

In addition, the fifth transitory article establishes that the commitment contracts of electric power generation capacity and electric power purchase and sale subscribed with independent energy producers under the Public Electric Power Service Law, must be reviewed in order to guarantee their legality and compliance with the profitability requirement for the Federal Government.

In this regard, Verónica Irastorza, director of NERA Economic Consulting, pointed out that the “profitability requirement” is unclear.

“I think it can be subject to arbitrary criteria that can generate a lot of uncertainty. Additionally, these contracts were the result of public tenders where in theory the winners offered the best price for the CFE ”, he mentioned.

For its part, Diana Pineda, partner of the González Calvillo law firm, mentioned that the transients have generated uncertainty, since The investors they need long-term trust.

“There is a principle in law called legitimate trust, and it is part of legal security and protection of the expectations that the government creates in private initiative, which means that if the government carries out an energy reform, the expectations of the industry they must be protected ”, he stated.

Casiopea Ramírez, partner at Fresh Energy Consulting, He said that strengthening the CFE and not raising the rate are not the solutions to meet the objectives established by the reform initiative itself.

“It is not because they are limiting access to cleaner, cheaper and more reliable energy because the diversification of sources not only of generation, but of investment is being avoided,” he said.

He mentioned that the reform seeks to generation and commercialization is from CFE, which puts pressure on it because it is not a company in terms of efficiency, costs or that it has the best technology to generate energy or take care of the environment.

Instead of an electrical reform, the Employers’ Confederation of the Mexican Republic (Coparmex) He stated that “the right thing to do would be to improve the regulatory framework based on a deeper reflection that ensures, for the good of the country, the sum of public and private efforts,” he stated in a statement.

For its part, the Association of Banks of Mexico (ABM) He asked the Federal Government for certainty and clarity so that the investments are maintained, especially in the case of the electricity sector.

“Unfortunately, the intention of this initiative is to consume first what the Federal Electricity Commission generates and not necessarily the cheapest energies, and there the private initiative in Mexico and throughout the world is moving to renewable energies: wind and solar mainly, but to a limited extent also geothermal ”, said Luis Niño de Rivera, president of the ABM, in a videoconference.

With information from Leticia Hernández and Jeanette Leyva.

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