Mexico City, February 5th, 2021.
On February 03rd, 2021, the Supreme Justice Court (“SCJN”) issued a resolution against the Federal Government Public Policy (the “Policy”) related to the Reliability, Safety, Continuity and Quality of the Electric National System released by the Energy Ministry (“SENER”) on May 15th, 2020.
The resolution issued by the SCJN derives from the constitutional controversy filed by the Federal Antitrust Commission (“COFECE”) against the referred Policy.
As per the SCJN resolution, 22 specific provisions included in the Policy were invalidated under the argument that the governmental Policy hinders the fulfillment of the constitutional purposes entrusted to COFECE since it nullifies the assumptions related to the economic competition and free concurrence that there should be in the electricity generation and supply market, in particular regarding the intermittent clean energies.
Among other arguments for the SCJN to partially invalidate the governmental Policy, is the fact that same gives an exclusive and improper advantage to the State-Owned Productive Company, Federal Electric Commission (“CFE”) allowing such company the proposal of strategic projects for the development of the National Electric System, which prevision is not applicable top other private competitors in the market.
Since the above referred resolution was issued by the highest judicial court in Mexico, there would not be a possibility for SENER to appeal such resolution and therefore it should be considered as definitive.
The effects that the resolution will have in the market, among others, mainly consist in: (i) the fact that governmental entities such as SENER and the National Centre of Energy Control (“CENACE”) will not be able to implement some of the provisions originally included in the Policy; (ii) CFE will not be able to propose priority projects for electric energy supply; (iii) CENACE will not be able to implement the interconnection criteria included in the Policy; and (iv) SENER will not be able to implement part of its proposed Policy which originally affected, among others, the electricity through renewable energy technologies.
The lawyers of the energy, infrastructure and administrative area at firm are available for any questions or comments on the above.
S I N C E R E L Y,
Juan Carlos Serra
Jorge Eduardo Escobedo