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    Electricity reform would cause power outages

    January 24, 2022 - CE Noticias Financieras


      In the first minute of the entry into force of the electricity reform, the country would have an energy deficit that the Federal Electricity Commission (CFE) would not be able to cover, which would immediately imply "shutting down" part of the system, said Eleazar Castro, consultant and specialist in electricity markets.

      The CFE has 50 percent of the total generation capacity available, but the reform initiative requires it to cover 54 percent of the market for the private sector to secure the remaining 46 percent, without any protection to guarantee a transitional regime, he exposed during the Open Parliament organized by the Congress last week.

      "You put a restriction on CFE to cover 54 percent of the market, but it only has the availability to generate 50 percent because its plants are unavailable or have failures, are we going to turn off that 4 percent? (...)", he said in an interview.

      In turn, he added, the private sector can say that it is not participating and that it is going to international tribunals to enforce its rights.

      "You cannot operate a plant in litigation," he explained.

      The specialist in applied mathematics, and who from Cenace participated in the construction of the Wholesale Electricity Market model, the result of the 2013 reform, anticipates a series of operational risks, since the initiative did not consider a transition regime as it did then.

      "If you eliminate all contracts, and there is no intermediate rule of at what prices and under what conditions I am going to buy from you, it immediately generates a limbo," he mentioned.

      "The worst thing that could happen is that all this becomes very discretionary for the CFE to determine under what conditions you buy."


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