Gas pipelines, LNG seen as safe haven for energy investors in Mexico (BNamericas)
BNamericas asked where energy capital was going in Mexico in June 2020, after federal action against private wind and solar projects pushed investors toward gas infrastructure. Kijana Mack, Director at Mexico Energy Partners, gave the firm's read.
“We believe natural gas development projects, and pipeline services, are the most attractive investment opportunities right now. These projects, and the related services, are highly visible and vital to the manufacturing industry in Mexico,” Kijana Mack, Director at Mexico Energy Partners, told BNamericas.
Read the full article on BNamericas
What this meant for industrial buyers
The conditions that made gas infrastructure look defensible to investors changed two things at plant level in mid-2020.
The first was cost. CRE revised the porteo estampilla transmission tariff applied to holders of legacy interconnection contracts, the autoabasto and cogeneration permits carried over from the pre-2014 regime, with the higher charge reported as applying from July 2020. La Jornada reported on 11 June 2020 that CFE Intermediación de Contratos Legados raised those porteo tariffs by 427 to 811% depending on voltage level. Any facility drawing power under a legacy self-supply structure needed to re-run its delivered cost against CFE supply and against qualified supply alternatives before the July billing cycle, not after it.
The second was supply security. CENACE issued an acuerdo on 29 April 2020 suspending pre-operational testing for wind and solar plants, and SENER's Política de Confiabilidad followed in the DOF on 15 May 2020. Both drew immediate legal challenge. For a facility, the practical effect was that new private renewable supply became harder to schedule, which left gas-fired generation carrying more of the load and made a site's own gas position more consequential.
The question worth answering that month was narrow. Is the transport behind your gas supply firm or interruptible, and who holds the capacity, your plant or your marketer. The same question sits behind Mexico's dependence on gas imported through Texas, and it costs nothing to check.
Check what the tariff change did to your delivered cost
Mexico Energy Partners reviews delivered energy cost for industrial sites in Mexico, including legacy self-supply structures exposed to the transmission tariff revision and the firm or interruptible status of gas transport. An initial review needs twelve months of CFE billing and the current supply contracts.