Capacity and distribution on a CFE medium voltage bill are charged per kW of measured demand. They do not fall when a plant uses fewer kWh. The Comisión Reguladora de Energía published the GDMTH tariff components for the Valle de México Centro division in June 2018. Capacity was 309.38 pesos per kW and distribution 58.56 pesos per kW. On those figures a site billed at 1,000 kW pays about 368,000 pesos a month before any energy is counted. At a 50% load factor and a blended energy price near 1.10 pesos per kWh, that is roughly 48% of the invoice. At an 80% load factor it is roughly 36%.

That ratio decides the order of work, and the order is where most industrial energy programs go wrong. Measure first. Clear the power factor charge, because it costs the least to fix. Attack billed demand next, because it is the largest single line at most sites. Put generation after that, not before it. Run Código de Red compliance as a standing obligation rather than a project.

Five levers follow, in that sequence. The decision each one supports is narrow. Which lever earns a place in the current capital plan, and which should wait for twelve months of interval data before anyone signs for equipment.

What is pushing industrial power costs up

The tariff has moved, and it has moved in one direction recently. Energía Hoy reported on 16 January 2025, citing analysis by the consultancy Quartux, that CFE applied an increase of about 12% to industrial tariffs for 2025, with GDMTH, DIST and DIT the most affected. The same analysis put the movement between September 2023 and September 2024 at 3.39 to 3.89%, varying by region and by time period.

Regulation moved as well. The Ley de la Comisión Nacional de Energía was published in the Diario Oficial de la Federación on 18 March 2025 and created the Comisión Nacional de Energía, which took over the functions previously held by the Comisión Reguladora de Energía. Código de Red enforcement now sits with the CNE. Any compliance plan still addressed to the CRE needs redirecting.

Lever 1: build a measured baseline before anything is bought

The first step is knowing when and where the load actually sits. That means interval metering at the main and at the largest feeders, not a reading of the invoice. An invoice gives monthly totals. A load profile gives the shape, and the shape is what determines whether storage pays, whether a tariff change pays, and how large a solar array can be absorbed on site.

The cost of skipping this step is concentrated in one place. A battery sized against an assumed peak instead of a measured one is the most expensive mistake available in this field, because the asset is bought before the number that justifies it is known. An instrumented energy audit produces that number.

Lever 2: clear the power factor charge

CFE applies a power factor adjustment to medium voltage supply. Below a measured power factor of 0.90 the invoice carries a surcharge. At or above 0.90 it carries a credit. The surcharge is three fifths of the quantity 0.90 divided by the measured power factor, minus one, taken as a percentage of the energy, capacity and distribution charges. The credit is one quarter of the quantity one minus 0.90 divided by the measured power factor. CFE caps the surcharge at 120%, reached at a power factor of 0.30, and caps the credit at 2.5%, reached at unity.

Worked at 0.85, the surcharge is 3.53%. On energy, capacity and distribution charges of one million pesos in a month, that is 35,300 pesos, and 423,600 pesos across a year at the same reading. Correction is usually a capacitor bank, and it is the cheapest of the five levers by a wide margin. Most plants aim above the threshold rather than at it, at 0.95 or better, so that normal load variation does not drop them back under 0.90.

Two conditions make it fail. Fixed capacitor banks can overcorrect on light load, which pushes the site into a leading power factor. And on plants with heavy variable speed drive content, harmonic distortion can drive resonance and shorten capacitor life. Both are found by measurement, which is why this lever sits after the audit and not before it.

Lever 3: use storage to lower billed demand

Billed demand is not a single number read off one bad afternoon. CFE measures demand in 15 minute intervals and charges capacity and distribution as separate components, so the quantity a battery has to suppress is defined by the tariff structure rather than by the month's highest instantaneous reading. A system sized against the wrong definition will be sized wrongly. The mechanics are set out in how GDMTH demand charges are billed.

Peak shaving charges the battery in low priced hours and discharges it during the periods that set billed demand. Note what does and does not change. Demand in kW falls. Consumption in kWh does not, and after round trip losses it rises slightly. The saving is in the demand charge alone.

The table below is an illustration of the effect on a hypothetical facility, not a measured result at a client site.

Table 1: Comparative monthly electricity bill with and without BESS

How to read the table. It is modeled, and three variables sit behind it. Demand is billed at an implied 30 US dollars per kW per month, which is what 30,000 dollars across 1,000 kW gives. CFE bills in pesos, so the dollar figures depend on the exchange rate at the billing date, which the table does not fix. And the 2,000 dollar power factor line clears through capacitor correction under lever 2, or through an inverter specifically configured and sized for reactive support, which is a design choice and a cost the table does not carry. Peak shaving on its own does not correct power factor. On a storage only basis the monthly saving in the table is 9,000 dollars rather than 11,000.

Storage also has a condition under which it does not pay. A flat load profile with a low peak to average ratio leaves little to shave, and the battery is then bought to remove a peak that barely exists. Twelve months of interval data settles that question before a purchase order does.

Lever 4: fix a share of the energy price with onsite solar

Onsite generation fixes the price of the kWh it produces and leaves the rest of the bill where it was. That is the honest version of the hedge, and it is still worth having. Assume a 700 kW array at a 20% capacity factor, an assumption to be replaced by a site specific yield study. It produces about 1.2 GWh a year. At a plant consuming 6 GWh a year, that fixes about a fifth of the energy volume and none of the capacity or distribution charge.

The permitting position changed in 2025 and it favors smaller systems. The Ley del Sector Eléctrico, published in the Diario Oficial de la Federación on 18 March 2025, raised the capacity above which a generation permit is required from 0.5 MW to 0.7 MW. The Comisión Nacional de Energía then published an acuerdo in the Diario Oficial de la Federación on 6 August 2025 setting the requirements for interconnected self consumption plants of 0.7 MW and above and below 20 MW. Below 0.7 MW a project stays outside that permit process. That threshold, not the roof area, is what usually sets the design.

Lever 5: treat Código de Red compliance as a standing obligation

The Código de Red was issued by the Comisión Reguladora de Energía as resolution RES/151/2016 and published in the Diario Oficial de la Federación on 8 April 2016. It sets technical requirements for load centers connected at medium and high voltage, covering voltage, frequency, short circuit capacity, power factor, protection, control, information exchange and power quality. The CRE's own published guide to those requirements records that non compliance is sanctionable under the electricity law, and that the top of the scale for serious breaches runs from 2 to 10% of gross revenue received in the previous year. For a plant billing 200 million pesos a year, the bottom of that band is 4 million pesos. That is the figure to put in front of a board, not a dollar range. What the Código de Red requires is a separate discipline from cost reduction.

One caution about how compliance is sold. Código de Red work addresses power quality. It improves stability and it can extend equipment life. It does not reliably lower kWh consumption, and a compliance budget defended on an energy saving that does not arrive will not be approved twice.

Sequencing, and where the levers interact

Run the audit in year one and let it gate everything else. Take the power factor correction immediately, because the payback is the shortest and the freed cash is real rather than modeled. Hold the storage decision until twelve months of interval data exist, and size it against billed demand as the tariff defines it. Evaluate solar and storage together rather than one after the other, because the array changes the load shape the battery is sized against, and a battery specified before the array is specified will be the wrong size.

Compliance runs alongside all of it, on its own schedule, funded from risk rather than from savings.

Start with the load profile, not the equipment

Send twelve months of CFE invoices and the single line diagram for one site. Mexico Energy Partners returns the bill split between energy, demand and the power factor adjustment, the power factor position against the 0.90 threshold, and a view on whether the load profile has enough peak to average spread for storage to be worth modeling. That determines which of the five levers is worth funding first. It is a scope and a set of findings, not a promise of a saving. Start by requesting an energy audit scope for a single site.

Sources

• Comisión Reguladora de Energía, Memoria Documental: Tarifas Finales del Suministro Básico, 31 October 2018. GDMTH capacity charge of 309.38 pesos per kW and distribution charge of 58.56 pesos per kW for the Valle de México Centro division in June 2018, used to derive the demand share of the invoice.
• Comisión Reguladora de Energía, Sesión informativa con CFE: Tarifas Finales de Suministro Básico, Media Tensión, February 2018. Measurement of demand in 15 minute intervals and the separation of capacity and distribution charges.
• Energía Hoy, Aplica CFE un aumento a las tarifas del sector industrial para 2025, 16 January 2025, citing analysis by Quartux. The 12% 2025 industrial tariff increase and the 3.39 to 3.89% movement from September 2023 to September 2024.
• Ley de la Comisión Nacional de Energía, Diario Oficial de la Federación, 18 March 2025. Creation of the CNE and absorption of the functions of the Comisión Reguladora de Energía.
• Ley del Sector Eléctrico, Diario Oficial de la Federación, 18 March 2025. Generation permit threshold raised from 0.5 MW to 0.7 MW.
• Comisión Nacional de Energía, acuerdo on permit requirements for interconnected self consumption plants of 0.7 MW to under 20 MW, Diario Oficial de la Federación, 6 August 2025, as reported by Greenberg Traurig on 12 August 2025.
• Comisión Reguladora de Energía, resolution RES/151/2016, Código de Red, Diario Oficial de la Federación, 8 April 2016, and the CRE's Guía sobre los requerimientos técnicos del Código de Red aplicables a Centros de Carga. Technical requirements for load centers and the sanction band of 2 to 10% of prior year gross revenue for serious breaches.
• CFE, published tariff terms for medium voltage supply, and Comisión Nacional para el Uso Eficiente de la Energía, Herramienta para el ajuste del factor de potencia. The 0.90 power factor threshold, the 120% surcharge cap and the 2.5% credit cap.