Mexico Commits to a New Energy Planning Model with a Social and Climate Focus

The Energy Planning and Transition Law (LPTE) seeks to incorporate, from its inception, a national energy planning framework aligned with the transition toward a cleaner and decarbonized system, without compromising energy security, social justice, or productive competitiveness. To achieve this, it promotes the development and use of clean energy.

Key Objectives:

• Centralize and optimize national medium and long-term energy planning.
• Strengthen the Federal Electricity Commission (CFE) and Petróleos Mexicanos (PEMEX) within the energy transition framework.
• Promote efficient and sustainable energy use, focusing on clean energy diversification, circular economies, and carbon emissions reduction.
• Incorporate principles of energy justice, sustainability, and human rights in sector planning and activities.

The LPTE broadens the scope of the repealed Energy Transition Law by integrating binding planning for the entire sector.

It also introduces the concept of externalities: the social, environmental, and health impacts not reflected in the market price of a product or service, which will become key elements in decision-making processes.

This seeks to improve traceability, transparency, and collective accountability in the energy sector, aligning with international climate change commitments.

Particularly aimed at protecting:

• People living in energy poverty (when a household cannot meet one or more basic energy needs such as water heating, cooking, food preservation, or lighting).
• Indigenous and Afro-Mexican communities or their equivalents.
• Natural spaces and resources.

Planning Instruments:

The Ministry of Energy (SENER) will centralize planning through the following instruments:

• National Energy Transition Strategy.
• Sectoral Energy Program.
• Plan for Energy Transition and Sustainable Energy Use.
• Electric Sector Development Plan.
• Hydrocarbons Sector Development Plan.

Goals of the Planning Instruments:

• Ensure the predominance of CFE and progress toward energy self-sufficiency.
• Modernize public and private energy infrastructure.
• Ensure affordable prices for final consumers.
• Promote decarbonization and technological innovation.
• Boost clean energy value chains and waste valorization.
• Strengthen national energy competitiveness.
• Ensure transparency and information availability through the National Energy Information System.

All regulations, laws, rules, permits, authorizations, and projects must align with these planning instruments, which are mandatory.

Strategic Pillars for Energy Transition:

• Energy Efficiency: Energy efficiency is established as a strategic axis in the energy transition. To this end:
  • The National Commission for the Efficient Use of Energy (CONUEE) will issue catalogs of electrical equipment and appliances meeting efficiency standards to promote their use and consumption.
  • The CFE and other providers must include messages in their services and products encouraging efficient energy use.
  • Energy efficiency studies must be conducted every three years, enabling CONUEE to make adjustments that improve consumer impact.
  • SENER, with CONUEE’s technical support, will issue certificates of excellence in energy efficiency, enabling market recognition of products.
  • CONUEE will have inspection and oversight powers, including the ability to impose penalties for non-compliance.
• Funds and Financing: SENER will manage and allocate resources to the following funds:

  • Energy Transition and Sustainable Energy Use Fund:

    Funded by private companies or financial institutions, this fund will support scientific research, technological development, and innovation projects focusing on hydrocarbon efficiency, renewable energy, and clean technologies.

    CONUEE will determine which technologies are economically viable and energy efficient to qualify for this funding.

  • Universal Energy Service Fund:

    These funds aim to eliminate inequality and energy poverty by ensuring equitable access to sustainable energy sources.

• Clean Energy and Clean Energy Certificates (CELs): The law seeks to promote clean energy growth through a revamped carbon market and a new CEL regulation. This system will establish measurable and transparent criteria to recognize and promote clean energy generation:
  • The methodology issued by the National Energy Commission (CNE) must account for the backup use of fossil energy and the additional and related services required for the operation of clean energy within the National Electric System. These services, provided by fossil sources, must consider annual system operation data.
  • A Public CEL Registry will be created, containing the registration of each certificate, including issuance date and ownership history.
  • The registry must enable private parties to engage in legal acts related to the purchase, sale, collateralization, or any operation involving property transfer, either in real, virtual, or legal terms.
  • The CNE must issue or update the operational rules for the certificate registry.
  • CELs will have a validity of 30 months and must be reported or acquired during the first four months of each year.

SENER will set a minimum mandatory clean energy participation target, aligned with the General Climate Change Law.

Relevant Transitional Provisions:

• The regulation of the law must be published no later than September 19, 2025.
• The planning instruments must be published by March 14, 2026.

Conclusions:

The strategy emphasizes the preeminence of CFE, which may limit private sector participation.

• The principles of energy justice and sustainability mandate the inclusion of human and environmental rights in all decisions.
• A redesign of the Clean Energy Certificate system is expected, which could stimulate a robust carbon market and accelerate the energy transition.
• The LPTE imposes binding planning, requiring all sector stakeholders to comply with the planning instruments.