The electric sector in Mexico has experienced sustained growth over the last three decades, with an annual rate of 3.5%, surpassing the growth of the total GDP. This industry has become a fundamental pillar for capital-intensive sectors, such as manufacturing, consolidating its importance in the country's economy.
The energy reform currently debated in Congress could mark a significant turning point in the development of the sector. Over the years, the weight of oil in the economy has declined while the electric sector has increased its participation, reaching 1.2% of GDP in 2020.
The reform proposal seeks to stimulate the development of the electric sector without jeopardizing public finances, with the key challenge for the Federal Electricity Commission (CFE) being to find a balance between sector expansion and fiscal restrictions.
The new energy reform scheme proposes to maintain the wholesale electricity market, allowing for different generation schemes by both CFE and private companies. Clear rules are established for CFE's participation in the electricity injected into the grid, including long-term contracts with producers.
Despite the challenges that persist in the regulation of electric dispatch, it is expected that this proposed regulatory framework will prevent a sharp halt in the sector's growth and contribute to a gradual recovery of the dynamics observed in previous years.
The financial situation of CFE reflects a cumulative net loss compared to previous years, which represents a challenge both financially and institutionally for the company. The success of the energy reform will largely depend on its implementation and overcoming regulatory barriers and infrastructure investment that have limited the sector's growth in recent years.
