Energy Reform Legislation in Mexico Gives the Private Sector Unprecedented Opportunities in the Mexican Electrical Power Industry

Mexico’s President recently signed into law a historic package of legislation to restructure the nation’s electrical power sector. This article discusses the legislation, which will create a more open and competitive power industry in Mexico, giving the private sector unprecedented opportunities to(i) generate power in Mexico for sale as a competitive wholesale electricity market and/or under long-term contracts with marketers or qualified users, (ii) market electricity service to large-scale consumers in Mexico, and (iii) enter into joint ventures, public-private partnerships, and service contracts with the state or the state-owned utility for the financing, construction and operation of infrastructure needed for the transmission, distribution, and generation of electrical power.

Background -

Eight months after Mexico amended its Constitution to reform and restructure the nation’s energy industry (the “Energy Reform”), President Enrique Peña Nieto signed into law a much-anticipated package of legislation to implement the Constitutional amendments (the “Implementing Legislation”). This Implementing Legislation, which went into effect on August 12, 2014, includes eight new laws, as well as amendments to thirteen existing laws, covering both the oil and gas industry and the electrical power sector in Mexico.

Originally published in Pratt’s Energy Law Report in October 2014.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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