Lack of energy in Mexico puts the foot to nearshoring

the insufficiency of electricity in Mexico and the requirement for green energy to comply with environmental commitments already creates havoc for the operation of national and international companies in some states such as Ciudad Juárez, Guanajuato and even Querétaro, which complicates the relationship with investors, causing “two to think about it.” times to attract new capital to the country”, and stop the boom of nearshoringbusiness leaders agree.

“There are certain states that have insufficient energy, in (Ciudad Juárez), Taiwanese (investors) require more electrical capacity and (the federal government) is giving them a promise to provide them with energy in 2026,” says José Abugaber, president of the Confederation of Industrial Chambers (Concamin).

Querétaro could also begin to have insufficiency problems, and they are already looking for options to supply energy to companies to continue the operation of the arrival of new investments, he exposes. However, this is in addition to the fact that the Energy Regulatory Commission (CRE) continues to slow down electricity generation projects, as it recently did with the wind farm in Iberdrola in Guanajuato. “It is an issue where they are thinking about before investing in Mexico,” warns the leader of the industrialists.

Clean energy, key to nearshoring

“The investment is not a little sister of charity that is going to say: ‘I am going to help this one or the others.’ Investment is a matter that is given by certain factors, when they are met and in Mexico it is given by the T-MECand second, because the companies that achieve it have had access to competitive energy, cheap gas and competitive energy production”, says Antonio del Valle, president of the Mexican Business Council (CMN).

The absence of clear rules so that the private initiative can invest in the energy sector have caused several projects ready to start operations in Mexico to be stopped due to the lack of energy that the Mexican State alone cannot provide, argues José Medina Mora, National President of the Employers’ Confederation of the Mexican Republic (coparmex).

“We have information from companies in Texas (United States) with investment projects in Mexico, with financing, that they have said better not to invest in Mexico”, despite the fact that a range of opportunities has opened up with the nearshoring. CMN companies see the energy issue as an obstacle to nearshoring in the immediate future, and to meeting their international commitments to reduce their carbon footprint.

“If we do not focus on building the necessary infrastructure… Because we continue with the cheapest gas in the region and we will continue like this for many years, and we must take advantage of it, we must generate infrastructure instead of negotiating,” warns Antonio from the valley.

The president of the Business Coordinating Council (CCE), Francisco Cervantes, comments that the eventual insufficiency of electricity in the country is an issue that is being worked on with the federal government, because if the conditions do not exist there will be no confidence for more investment and increased production.

“We are in talks, we are at work tables, we are looking for points of agreement in this dialogue so that we can improve these conditions, but obviously, the position of the business sector is that we do have to have openness in all sectors,” he adds.

In this sense, the president of Concamin urges the federal government to increase energy generation in all states, to invest more, because “we are limited and there are 34 projects that the Federal Electricity Commission (CFE) It has the radar that it is going to invest, but there is no end date and even less a start date.

There are firms and agreements from foreign investors in conjunction with the federal government to invest in energy development, but they have not been concluded, and those that are, are holding them back, as happened with Iberdrola”, he reproaches.

Industrialists are concerned that the decarbonization goal is not met, since according to the 2030 agenda, 50% of the cars on the road must use clean energy, so the challenge is huge for Mexico and not lose space to be one of the big manufacturers. “If we don’t get on the clean energy agenda, we’re going to have a serious problem and the carbon footprint won’t go down,” Abugaber warns.

lilia.gonzalez@eleconomista.mx