Mexico is one of the best places in the world for solar energy production. It has excellent sunlight, small seasonal differences. On paper, at least, Mexico is well positioned to produce competitive solar. Over the past decade, Mexico has attracted billions of dollars in new solar investment. But investment in solar power has stalled under President Andrés Manuel López Obrador, a controversial populist who mocks policymakers and often has a nationalist wing.
Over the past decade, Mexican politicians have worked to pass laws and create opportunities for private sector investment in renewable energy. In 2017 and 2018, Mexico received more than $10 billion in renewable energy investments. In recent years, the combined share of wind and solar power in Mexico has increased. It has quadrupled from 3% in 2017 to 12% in 2022. For example, in Mexico, the share of renewable energy is still about half. Mexico ranks second in Latin America behind Brazil in terms of renewable energy solar production in the United States, but behind smaller countries such as Italy, Japan and the Netherlands in total solar production.
Unfortunately, under López Obrador, Mexico stopped issuing permits and canceled solar project tenders, effectively ending private sector investment in solar projects. As president, López Obrador promoted fossil fuels and neglected renewables. In general, López Obrador appears to have little interest in solar energy development. Your government is now promoting the Puerto Peñasco project, but the actual funding seems to be very small. The López Obrador government has spent around $400 million on the first phase of the project. In short, that's about 2 percent of the budget for López Obrador's main refinery being built in his home state of Tabasco.
López Obrador has authorized the burning of coal and oil to generate electricity and has publicly derided wind turbines. In the year If Mexico wants to generate 38.5% of its electricity using clean energy by 2030, it will need to invest heavily in renewable energy. During the López Obrador administration, most foreign companies have ignored investment opportunities in Mexico.
In a recent podcast discussion, Diego Rivera Rivota, a researcher at the Center for International Energy Policy at Columbia University, said: “This government is developing renewable resources. Not only does it fail to promote and increase renewable energy investments; But the policies implemented by this government have actively undermined the development of such projects. "
In the year In 2017, Mexico received the highest 35% of renewable energy investments in Latin America. Currently, this figure is only 7 percent.
Rivera Rivota added, "Mexico is going in the opposite direction of the world. This is a missed opportunity. Mexico has enormous wind and solar resources."
He singled out Sonora, Nuevo León, Puebla and Durango as looking to invest in solar projects, but under López Obrador, most renewable energy investors chose Mexico in favor of Brazil, Colombia and Chile, he said.
Asked to choose three words to sum up López Obrador's position in the private sector, Rivera Rivota chose "nationalist, hostile and backward."
In the year In 2023, López Obrador is trying to change his message and get Mexico to build electric cars. However, Rivera Rivota said that the most significant barriers to renewable energy investment in Mexico as a whole will not disappear until López Obrador leaves office in 2024.
"The prevailing sentiment in the private sector today is a sense of uncertainty. The big question is who will be the next president. The optimists believe they can weather the storm and hope for less hostile politics (with the new president)," Rivera Rivota said.
Check out the full interview with Diego Rivera Rivota here.
