In a comprehensive effort for reforms, Mexico has opened its country’s wholesale energy market and it is booming! Day-ahead power trading for the Baja California Sur system began on March 15, 2016, and for the Baja Peninsula system on January 26. 2016. The National Interconnected system serving the mainland began on January 28. 2016. There are preliminary plans for the trading of financial transmission rights through auctions in late 2016, and virtual trading in 2017. The state-owned utility CFE will now have to compete with private firms for grid and consumer sales through the power grid and wholesale market controller Cenace.
Under the Mexican Ministry of Energy’s Guidelines the wholesale power market will be comprised of several parts:
- Day-ahead and real-time markets
- Power Market
- Clean energy related market
- Midterm auctions for energy
- Long-term auctions for power, clean energy and clean energy certificates
- Auctions of financial rights of transmission
To participate in cross-border transactions between the US and this newly-opened international electricity market, market participants need Export Authorization from the US Department of Energy (DOE). Export Authorizations to Mexico are reviewed and authorized by the Office of Electricity Delivery & Energy Reliability. Pierce Atwood’s Energy Practice Group has significant experience preparing Export Authorization applications and appearing before DOE.