Introduction

2021/22 Introduction

Like many other economic sectors, Mexico’s energy industry is in a difficult position halfway through 2021. The effects of the pandemic have placed a heavy burden on many commercial and industrial activities for numerous business segments. In addition, the governmental redirection of the energy sector seems to stand diagonally opposed to the tenets established with the previous administration’s reforms, causing widespread regulatory uncertainty for private players.

In reality, industry insiders stress that the outlook is not actually that gloomy. By nature, energy projects are planned with a long-term perspective, so democratically supported changes in the environment are to be expected. New renewable energy developments might have been paused but projects in later stages continue to forge ahead. Mexico has expressed its commitment to achieve its climate goals despite some delays in the shorter term, which means the country will need a great deal of new solar, wind and hydroelectric capacity, among other sources.

Newer technologies help to diversify the Mexican energy mix and help developers tackle inefficiencies. The country can expect to see spectacular growth in distributed power generation. Here, solar leads the developments but technologies such as cogeneration are expected to also make good on its promise. Within the wholesale electricity market, prospects remain attractive as an increasing number of large-scale energy users look to save costs and address their sustainability. Natural gas continues to grow in importance, offering opportunities to those involved in their marketing, transport, infrastructure and gas-based power production. In an effort to strengthen Mexico’s transmission and distribution system, industry analysts agree it will most likely require both reinforcement and expansion.

Mexico Energy Review 2021 looks back at what has already been achieved and, through upcoming developments, offers a glimpse into the future. By presenting a mixture of views from the top, highlights and analysis, MER2021 presents an accurate picture of the energy industry in Mexico today.