President Andrés Manuel López Obrador announced on Saturday his National Electricity Program, including moves to bolster CFE’s budget in an effort to return Mexico to energy self-sufficiency and the suspension of the fourth long-term electricity auction. “We used to be a self-sufficient country. Now, we have to purchase half of our electricity demand at very high prices. All of this has to be change,” said López Obrador, speaking at the Malpaso Dam in Chiapas.

The AMLO administration will add an extra MX$20 billion to CFE’s budget to accelerate its modernization process. “We will make a huge effort to save money, to avoid corruption and become an austere government so the budget is available,” he said. “This money will be available for investment. CFE will have a budget to invest next year.”

López Obrador also said that CFE plants will not be shut down during his administration. “The dismantlement of CFE has to end. No other plant will be closed. The policy of closing generation plants from CFE will end.” AMLO, as the president is commonly known, was accompanied by Rocío Nahle, Minister of Energy; Manuel Bartlett, Director General of CFE, and Rutilio Escandón, Governor of Chiapas.

The fourth long-term electricity auction, that was scheduled to take place on Dec. 4, was suspended, with no alternate date given. “Once the new administration finalizes the revision of the long-term electricity auctions’ scheme, its reactivation will be announced,” said Alfonso Morcos, former Director General of CENACE.

According to the PRODESEN 2018-32, 11,821MW is scheduled to be retired. This amount translates to 115 units located in 18 states. Of this capacity, 62.81 percent are generated by conventional thermoelectric technologies. The retirement focuses on CFE plants, but this may change in the coming years.

Malpaso’s hydroelectric plant was built between 1958 and 1966, the first infrastructure of this magnitude in Mexico. Located in the northeast of the state of Chiapas, its basin is powered by Grijalva river and supplies 1,080MW.



“After the violent times of the revolution, there was an economic policy that generated growth and progress and because of this progress, a great deal of infrastructure was built,” López Obrador said. “The fact that the former administration could not privatize the 60 hydroelectric plants and CFE’s transmission lines is extraordinary. These assets are for the nation and the same applies to PEMEX.”

According to the preliminary version of the 2017 National Energy Balance, renewable energy had a participation of 9.5 in the country’s energy mix. From this total, 1.6 percent was generated by hydroelectric energy. Nuclear energy represented the same amount in the energy mix, and geothermal, solar and wind accounted for 2.6 percent.

Manuel Bartlett, Director General of CFE, also outlined CFE’s strategy to modernize hydroelectric plants in Mexico. “In close collaboration with CFE and CONAGUA, we have studied the possibility of increasing hydro-energy capacity in the mix with an additional 3,300MW,” he said. “We have significant feasibility projects to install 2,000MW by taking advantage of 363 hydroelectric structures used for irrigation.”

Regarding the country’s imports of natural gas, López Obrador stated that, “The energy production powered by gas has to do with a well-designed business.” Bartlett added that the investments made in this area have caused diverse social problems and inefficiencies without providing a sole molecule of gas.

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