On February 16 2016 the Energy Regulatory Commission (CRE) published in the Federal Register the general administrative provisions on open access and services provided in the national transmission grid and the general distribution grids.

Adequate access to the national transmission grid and the general distribution grids has been identified as one of the most important conditions necessary to promote competition in the energy sector. Therefore, in line with the Electricity Industry Law, the new general administrative provisions are intended to facilitate the obligation of the National Centre for Energy Control (CENACE) to guarantee open access to the national transmission grid and the general distribution grids, which will remain owned by state productive subsidiaries of the Federal Electricity Commission (which will act as transporters and distributors).

In general, the new provisions establish:

  • open access obligations to which transporters and distributors will be subject;
  • the general terms and conditions for services related to transmission and distribution utility services;
  • additional rules relating to the interconnection and connection of power plants and load points; and
  • rules for the implementation of an electronic platform to inform the operating conditions of the national transmission grid and the general distribution grids.

Agreements for the provision of transmission and distribution services entered into by CENACE, transporters, distributors and market participants will be subject to the full spectrum of regulation established by the new rules and the general terms and conditions. The most relevant provisions are as follows:

  • The general terms and conditions will not be subject to negotiation, so CENACE, transporters and distributors will not be allowed to agree different terms with market participants and end users (except in cases permitted under the general terms and conditions).
  • Transmission and distribution services will be subject to regulated rates.
  • Specific billing procedures will be followed for transmission and distribution services rendered.
  • Suspension of transmission or distribution services will be permitted only in the cases contemplated in the general administrative provisions and the general terms and conditions.
  • Disputes between CENACE, transporters, distributors and those receiving services will be resolved through the dispute resolution mechanisms contemplated in the general administrative provisions.

Further, the general administrative provisions contain provisions regulating the partnerships and agreements entered into between private parties and transporters, distributors and the Ministry of Energy with respect to the expansion and improvement of the national transmission grid and the general distribution grids.

The general administrative provisions entered into force on January 29 2016, the start-up date of the wholesale electricity market.

For further information on this topic please contact Rogelio López-Velarde, Amanda Valdez, Daniela Monroy or Diego Campa at López Velarde, Heftye y Soria by telephone (+52 55 3685 3334) or email (rlopezv@lvhs.com.mx, avaldez@lvhs.com.mx, dmonroy@lvhs.com.mx or dcampa@lvhs.com.mx). The López Velarde, Heftye y Soria website can be accessed at www.lvhs.com.mx.

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