On 22 March 2023 the Comisión Federal de Electricidad opened an international tender for the drilling of six exploratory geothermal wells, at Los Negritos in Michoacán, San Marcos in Jalisco, Cerro Prieto in Baja California and Las Tres Vírgenes in Baja California Sur. The budget was about 51 million US dollars. Proposals were due on 12 May 2023.
The money comes from the Financing and Risk Transfer Program for Geothermal Energy in Mexico, announced in December 2022, under a contingent recovery agreement with the Inter-American Development Bank drawing on Clean Technology Fund resources. Successful wells are repaid at a preferential rate once they generate, and unsuccessful drilling converts to a grant, so the lender absorbs the drilling risk. If the wells flow, the IDB has a concessional credit line for plant construction. If they do not, nothing is built.
For a corporate buyer the more useful fact is who owns the fleet. Mexico had 953 MW of installed geothermal capacity in 2021, and CFE operated 927.7 MW of it, or 96%, according to CFE's own Gerencia de Proyectos Geotermoeléctricos in a presentation dated May 2023. Geothermal is a CFE asset class in Mexico, and almost nothing is left for a plant to contract. What you can contract is clean supply through the wholesale market, and that is a different conversation with a different threshold.
The operating fleet, correctly counted
Four geothermal fields are operated by CFE. Cerro Prieto in Baja California, in service since 1973, holds 570 MW. Los Azufres in Michoacán, in service since 1982, holds 252 MW. Los Humeros in Puebla, in service since 1990, holds 95.7 MW. Las Tres Vírgenes in Baja California Sur, in service since 2001, holds 10 MW. Those four sum to 927.7 MW.
One field is private. Domo San Pedro at San Pedro Lagunillas in Nayarit is owned by Geotérmica para el Desarrollo, part of Grupo Dragón. It accounts for the balance of the national total. Any statement that every Mexican geothermal plant is CFE's is wrong, and so is any count of five CFE fields, because CFE operates four.
Mexico started early and stopped early. CFE dates the first geothermal well at Pathé in Hidalgo to 1955, and the first geothermal power station in Mexico to 1959 at the same site. Geothermal was 1.1% of Mexico's installed generating capacity in 2021 and 3.1% of installed renewable capacity, on the same CFE figures. Cerro Prieto alone is 60% of the fleet and it entered service more than fifty years ago. For more on the resource behind the fields, see our earlier note on Mexico's geothermal resource base.
Why the fleet is CFE's, and what the law actually allows
The Ley de Energía Geotérmica was published in the Diario Oficial de la Federación on 11 August 2014. SENER is the granting authority. It issues reconnaissance registrations, exploration permits and geothermal concessions. An exploration permit runs three years with one extension of three years. A concession runs thirty years from its publication in the DOF and can be renewed. Article 30 allows individuals and companies incorporated under Mexican law to hold both. Article 51 routes the associated water concession to CONAGUA, which has thirty business days to issue it once SENER sends the file.
The reason the map looks state-owned is a transitional allocation, not a prohibition. On 23 July 2015 SENER granted CFE concessions over five fields with a combined 874 MW. They were Cerro Prieto, Las Tres Vírgenes, Los Azufres, Los Humeros and Cerritos Colorados in Jalisco. CFE also took exploration permits over 13 further areas across Baja California, Nayarit, Jalisco, Michoacán, Guanajuato, Puebla and Chiapas.
Private title is possible and has been granted. On 3 November 2015 SENER issued the first geothermal exploitation concession under the new law to Geotérmica para el Desarrollo for Domo San Pedro, for thirty years, covering 18 steam wells drilled to between 3,000 and 3,500 meters. Eight years later it remained the only privately held producing field. That is the practical answer to whether a developer can enter. Legally yes. Commercially, once.
What the 2023 tender is, and what it is not
The tender covers drilling services with two rigs for six exploratory wells. It does not build a power plant, it does not add a megawatt, and it does not commit the IDB to finance construction. The program structure makes the reason explicit. Geothermal capital is concentrated in wells drilled before anyone knows whether a reservoir will produce, which is why the exploration tranche is a contingent recovery grant rather than a loan and why the construction credit line sits behind a result.
Two of the four target areas, Los Negritos and San Marcos, are not producing fields. That is where the resource question is being tested. The other two, Cerro Prieto and Las Tres Vírgenes, are existing CFE fields where drilling supports output that is already dispatched. A reader tracking this should treat well results, not tender awards, as the event that matters.
What a private buyer can actually contract
Almost no geothermal energy is available to contract. The output of CFE's four fields is dispatched into the Mercado Eléctrico Mayorista by CENACE and settled at nodal prices like any other generator. Domo San Pedro is a single plant, and the 25.3 MW gap between the 953 MW national total and CFE's 927.7 MW is the whole of the privately held fleet. Neither gives a large industrial buyer a geothermal offtake of any scale to sign.
The route that does exist runs through the market. A centro de carga with 1 MW or more of maximum demand over the previous twelve months can register as a Usuario Calificado and buy from a qualified supplier or contract a PPA directly. Below that threshold the site stays on a CFE basic supply tariff. That single number, 1 MW at the meter, decides which conversation you are in.
Clean attributes travel separately, through Certificados de Energía Limpia. Read those claims carefully. Mexican law's category of energías limpias under the Ley de la Industria Eléctrica of 11 August 2014 is wider than renewables and takes in large hydroelectric, nuclear and efficient cogeneration alongside geothermal, solar and wind. The statutory 35% target for 2024 is a clean energy target, not a renewables target. If your parent company reports against a renewables commitment, a supplier's clean energy percentage is not the same measure. For the wider picture see our overview of Mexico's renewable generation mix.
The case against expecting much, and what would change it
Geothermal has the load profile a manufacturer wants. It runs at high capacity factors around the clock and it does not need storage to do it. That is precisely why the flat capacity number is the point. The fleet is 953 MW after five decades, and the current public program funds six exploration wells, not plants.
Three things constrain the build. Exploration drilling risk sits with whoever pays for the well. Drilling cost is front-loaded years before revenue. And the operator holding almost all the title is CFE, whose capital program sets the pace. None of those change because global interest in geothermal rises.
What would change the read is specific and public. Flow test results from Los Negritos or San Marcos that support a commercial unit. An IDB move from the exploration grant to the construction credit line. Or new SENER exploration permits issued to private applicants rather than to CFE. Watch those three. Treat announcements about potential as background.
What clean supply you can actually contract in Mexico
Geothermal is closed to most private buyers, so the practical question is what is open. Send Mexico Energy Partners twelve months of CFE invoices and an annual load profile with your maximum demand in kW by month. We set out the supply routes available to your site, whether the 1 MW Usuario Calificado threshold is met at each meter, how each route treats clean energy attributes, and what a change of supplier would require in contract and metering terms. You get a written comparison, not a proposal, and no assumption about what it will cost until the load data says so. Start with clean energy procurement.
Sources
Comisión Federal de Electricidad, Gerencia de Proyectos Geotermoeléctricos, Estado del desarrollo de la Geotermia en México, May 2023. Field capacities, start-up years, the 953 MW national total for 2021 and the 1.1 and 3.1% shares.
Mexico Business News, Mexico Announces Tender for Six Geothermal Wells, 22 March 2023. Tender scope, target areas, budget and bid deadline.
ThinkGeoEnergy, New funding to support second generation geothermal development in Mexico, 8 December 2022. The Financing and Risk Transfer Program, the Clean Technology Fund contingent recovery resources and the construction credit line.
Ley de Energía Geotérmica, Diario Oficial de la Federación, 11 August 2014. Articles 7, 17, 26, 30 and 51 on granting authority, permit and concession terms, eligibility and the CONAGUA water concession.
REVE, Sener otorga cinco campos geotérmicos a la CFE, 23 July 2015. The five concessions totaling 874 MW and the 13 exploration permits.
Expansión Obras, México otorga primera concesión para planta geotérmica en Nayarit, 3 November 2015. The first private geothermal concession, its holder, term and well count.
Ley de la Industria Eléctrica, Diario Oficial de la Federación, 11 August 2014. The definition of energías limpias and the Certificados de Energía Limpia regime.
Manual de Registro y Acreditación de Participantes del Mercado, SENER, Diario Oficial de la Federación, 15 July 2016, and the Usuario Calificado registration threshold of 1 MW of maximum demand.