The National Development Plan (PND) 2019–2024 presents a proposal for the transformation of public life in Mexico for the well-being of its population. To achieve this transformation, the objectives and strategies set forth in this document are aimed at addressing the main underlying causes that have impeded national development.

Since the national energy reform started in Mexico approximately five years ago, much has been achieved, but there are still plans to enact. Onshore oil and gas projects are expected to advance and continue to develop.

The ongoing expansion of natural gas pipelines will open new markets for these fields and bolster the economy.

In the retail oil market, a combination of limited refining capacities and rising demand means that Mexico is currently a net importer of oil products. The oil products market is being liberalized ahead of the initial schedule. Since 2016, importation of oil products such as liquified petroleum gas, gasoline and diesel has been open to non-PEMEX entities. From January 2017 to November 2017, the retail oil market was opened, one year earlier than initially announced. Furthermore, subsidies on oil products were phased out from 2008 to 2014.

Natural gas is the second largest primary energy source in Mexico (23% of total primary energy supply in 2016 versus 63% for oil), and gas demand is set to grow gradually according to the Ministry of Energy (Secretaria de Energia, SENER) projections to 2029. This demand underlines the need to focus on upstream supply, storage and transportation in policy discussions. The expansion of the gas pipeline network has lagged behind the boom in gas demand. Further expanding the system is urgent, as the system has already reached saturation on several occasions. These events also highlight the need for more storage capacity in the system. Creating an integrated national gas grid also requires close cooperation between CENAGAS (the independent system operator) and private pipeline owners. In the retail natural gas market, it is critical that the gas release programme, under which PEMEX must reduce its market share to 30% by 2020, be implemented successfully. New investment for an estimated US $9.6 billion annually in electricity is essential to meet the rapid growth expected in electricity demand (IEA, 2016), allowing Mexico to reach its target of producing 35% of its electricity from clean sources by 2024, compared to 21% in 2019.

The clean energy target is to be met through a quota system that includes a clean energy certificate obligation on retail suppliers (currently, and until the third long term power auction carried out in 2017, only the Comisión Federal de Electricidad) and large consumers that do not use retail suppliers. Clean energy technologies are defined to include renewable energy, nuclear energy, efficient cogeneration and fossil fired generation with carbon capture and storage. Clean energy certificates have been granted to facilities since August 2014; they can be bought directly under bilateral contracts with generators, in the clean energy certificate market launched in 2018, or at long term auctions. Consequently, generators of clean electricity will obtain additional revenue by supplementing their sales of electricity with the sales of clean energy certificates.

A centerpiece of the reform effort is the auction system for energy, capacity and clean energy certificates, which allows investments from new players into the market on a competitive basis. The auctions offer long term contracts (15 years for energy and capacity and 20 years for clean energy certificates) that provide a degree of stability over future cash flows for generation companies.

The Mexican clean energy auction system is a sophisticated procurement mechanism for the promotion of renewable energy. Distinctively, it seeks to capture the relative value for the system of different generation technologies by location and production profile. Projects located in higher priced areas of the country, or capable of delivering power at times of day when it is particularly needed, would receive higher revenues through the auctions and therefore attract more attention from potential investors.

Based on the two first tenders, held in 2016, the auction system is providing a substantial boost to growth of solar and wind energy, tapping Mexico’s wind and solar resources at competitive prices. It is unclear how new nuclear energy sources could compete under the current rules, which do not clearly indicate whether Mexican NPPs can legally participate in the electricity market and which require the projects to be ready within three years of the auction.

Regarding costs, electricity prices for households and farmers up to a consumption cap are subsidized between 60% and 70% of the total cost. Artificially low electricity prices are likely to hamper government efforts to pursue efficiency yet should be replaced by targeted social policy measures for those in need. The relevant regulators and SENER have expressed their intent to work with the Federal Electricity Commission (CFE) on correcting these distortions. Decreasing technical and non-technical losses, which are currently higher than elsewhere in OECD countries, would reduce the need for investment in additional generating capacity, while improvements in operational efficiency in the newly unbundled CFE could significantly reduce the retail component of the cost structure. A strengthened transmission and distribution system would further help reduce losses and is also necessary to support the projected growth in demand and in supply from variable sources, such as solar and wind.

The reform is implemented in stages. The real time market, capacity market and clean certificates market are important elements that were introduced in 2017–2018. Most of the remaining challenges now lie in the decisiveness and speed of implementing the reform, including the necessary adjustments and improvements that are likely to be required after the first years of experience.

Today we have a vision to go towards improving productivity, restitution of hydrocarbon reserves, diversification of fuel sources, progressive reduction of environmental impacts of energy production and consumption, greater participation of renewable energies in the national energy balance, energy savings and greater efficiency in its production and use, strengthening of SOEs and support for national research and technological development.

Mexico is a non-Annex I Party to the United Nations Framework Convention on Climate Change (UNFCCC) and ratified the Kyoto Protocol in 2000. It is an active non-Annex I Party in conducting and communicating national inventories on greenhouse gas emissions, having submitted five national communications under the UNFCCC. Mexico hosted a successful Sixteenth Conference of the Parties (COP16) in Cancun (2010) which lay the groundwork for a successful outcome at COP21 in Paris in December 2015. Mexico’s 2020 goal (set at COP15 in Copenhagen) of “reducing its GHG [greenhouse gas] emissions up to 30% with respect to the business-as-usual scenario by 2020” was incorporated into the UN process at Cancun. The target is conditional on the “provision of adequate financial and technological support from developed countries” (Mexico’s notification to the UNFCCC, January 2010). In September 2016, Mexico ratified the 2015 Paris Agreement.

Source: Energy policies beyond IEA countries.

Table 1 shows estimated available energy sources in Mexico.

TABLE 1. ESTIMATED AVAILABLE ENERGY SOURCES

	Fossil fuels			**Nuclear	Renewables
	Solid	Liquid	Gas	Uranium	Hydro	Other renewable
Total amount in specific units*	1 211	34 933	46 309	6 714	60	1 211
Total amount in exajoules (EJ)	0.29	222.33	48.44	26.09	0.13	0.29

*Solid, liquid: in million tonnes; gas: in billion m³; uranium: metric tonnes; hydro, renewable: TW.

**Fuente: Uranium 2018 Resources, Production and Demand, OECD/NEA 2018.

Note: 1 tonne uranium = 3.88713 x 10³ EJ.

Table 2 shows some energy statistics for Mexico.

TABLE 2. ENERGY STATISTICS

	1980	1990	2000	2010	2015	2016*	Compound annual growth rate (%) 2000–2016*
Energy consumption (EJ)**
Solids	0.10	0.14	0.27	0.53	0.53	0.52	0.042
Liquids	2.36	2.78	3.49	3.66	3.46	3.59	0.002
Gases	1.20	1.50	2.21	3.39	3.79	4.28	0.042
Nuclear	0.00	0.03	0.09	0.06	0.12	0.11	0.013
Hydro	0.07	0.09	0.12	0.13	0.11	0.11	(0.005
Other renewables	0.30	0.36	0.49	0.51	0.54	0.54	0.006
Total	4.029	4.902	6.677	8.291	8.553	9.159	0.020
Energy production (EJ)
Solids	0.07	0.14	0.23	0.31	0.29	0.25	0.005
Liquids	4.30	5.71	6.76	6.10	5.17	4.92	(0.020
Gases	1.47	1.48	1.78	2.20	2.04	1.78	—
Nuclear	—	0.03	0.09	0.06	0.12	0.11	0.013
Hydro	0.07	0.09	0.12	0.13	0.11	0.11	(0.005
Other/renewables	0.30	0.36	0.49	0.51	0.54	0.54	0.006
Total	6.22	7.81	9.47	9.32	8.26	7.71	(0.013

*Latest available data.

** Exajoules.

—: Data not available.

Source: Subsecretaría de Planeación y Transición Energética, 2018.

CFE Reorganization

The new administration has set as one of its main priorities the strengthening of the CFE to make it more competitive and efficient. One of the steps that will be followed to achieve this is reorganizing the company. After the reform, CFE was divided into 14 different, independent entities, each in charge of various parts of the value chain (generation, transmission, distribution, basic supply, qualified supply, etc). These divisions were made to balance CFE’s market power and to encourage the participation of new players in these newly liberalized markets. The generation assets of the CFE were then divided between six of these entities. The new administration considers that this division was inappropriate and improperly weakened the CFE as it had resulted in increased costs, hampered administrative specialization, and created inefficiencies.

On 25 March 2019, the Ministry of Energy (SENER) issued an amendment to the regulations which initially ordered this separation, allowing the generation subsidiaries to reorganize and reunify if required. The main objective behind this modification was to improve the CFE’s competitiveness in generation activities and to allow the CFE to increase co-operation and co-ordination between its various entities; share employees under certain conditions; regard all of the CFE’s divisions as a whole when defining investments and objectives, except in projects benefiting transmission and distribution activities; and allow the use of scale economies to improve operational efficiency and cost reduction in commercial activities.

The amendment provided 60 days for the submission of proposals for the reallocation of assets and generation contracts. As of this date, said proposal has not been submitted, but it is expected that the reallocation will be implemented in accordance with the geographical location of the assets. This reorganization will not affect the CFE divisions, other than those in charge of generation activities, and the main principles behind the original separation of CFE should continue to be respected. The Federal Economic Competition Commission (Comision Federal de Competencia Economica, COFECE) has issued recommendations as to how this allocation should be made, to guarantee that no competition barriers are raised as a result of it. Further action by COFECE is expected in the event of these not being followed.

New CFE Power Generation Projects

In addition to the CFE’s reorganization, there are plans for an extensive overhaul and renewal of its generation facilities, as well as the building of several new power plants. The CFE will contract specialized private entities to develop these projects. CFE has its own contracting regulations which require the awarding of contracts through public tender, but it also includes certain exceptions to allow direct awards or restricted tenders (which are commonly used in practice despite its 'exceptional' nature). The government has indicated that the main mechanisms that will be used for this are 'Productive Infrastructure Investment Projects with Deferred Registration in Public Expenditure' (Proyectos de Infraestructura Productiva con Registro Diferido en el Gasto Publico, PIDIREGAS). This allows a project to be developed with a contractor who provides the necessary investment in addition to optional financing; once completed, the project is transferred to the CFE and, on commencement of the operation, the contractor begins to receive payments from the generated cash-flow. Nonetheless, the CFE is allowed by law to use other mechanisms including public-private partnerships and regular public works or services contracts.

The Program for the Development of the National Electricity System 2019–2033 (Programa de Desarrollo del Sistema Electrico Nacional, PRODESEN) includes the development of new combined cycle (CC), geothermal (CG) and efficient co-generation projects (CO), as well as the modernization and renewal of hydroelectric power plants owned by the CFE. Between 2019 and 2020, the schedule suggests an increase in the CFE’s installed capacity by 3,945 MW through the expected completion of nine CC and CG projects, which are either about to be finished or are currently at the test stage.

Projects which are in the process of being tendered and are scheduled to commence construction in 2020 amount to 12,621 MW and are comprised of: (i) five hydroelectric projects with a combined capacity of 471 MW; (ii) CC Salamanca with 757 MW; (iii) CC San Luis Potosí with 740MW; (iv) CG Humeros III Stage B with 25 MW; (v) CC San Luis Rio Colorado with 450 MX; (vi) CI [Internal Combustion] Baja California Sur VI with 42 MW; (vii) CC Lerdo with 911 MW; and (viii) CC Tuxpan with 964 MW.

Additional co-generation projects are planned to be developed in tandem with the rehabilitation of PEMEX refineries which is part of an ambitious endeavour to increase the country's oil refining capacity: (i) CO Tula with 320 MW, (ii) CO Minatitlan with 870 MW, and (iii) CO Salina Cruz with 812 MW.

Renewable projects, which are still subject to technical and economic studies and financing possibilities and are scheduled to commence in 2023–24, are: (i) Sureste I Fase I with 105 MW; (ii) Sureste II and III with 600 MW; (iii) Sureste IV and V with 600 MW; (iv) Photovoltaic plant (PV) Cerro Prieto II with 150; (v) PV Villita with 62 MW; (vi) PV Central with 450 MW; (vii) PV Costa Jalisco Nayarit with 340 MW; and (viii) PV Guadalajara with 250 MW.

Studies are currently being conducted for eight more geothermal projects with a total capacity of 117 MW, as well as the reactivation of a hydroelectric plant with a capacity of 240 MW named Chicoasen II (scheduled to commence development between 2023 and 2024).

Alternative Generation Schemes

As a general rule, the new market regulations dictate that generators may not sell energy directly to end users, but only sell their energy through suppliers, to a qualified market-participating user, or directly to the wholesale electricity market. However, there are alternative generation schemes that offer the generators the possibility of selling their energy directly to the end user, under certain conditions. These schemes are distributed generation, isolated supply and local generation.

Distributed generation allows the generator to install a power plant and storage equipment to produce up to 0.5 MW for self-consumption, sale, or a combination of both self-consumption and sale. The generator must be interconnected to a distribution circuit containing a high concentration of load centers. Under this scheme, it is not necessary to obtain a generation permit, thereby simplifying the administrative process when initiating operations. The generator is able to sell the energy produced directly to an end user located in the same premises where the power plant is located without the participation of a supplier. The price for said energy can be freely agreed between the generator and the end user and, in the event of the end user not consuming all of the energy produced, any surplus may be delivered to the National Electricity System (Sistema Eléctrico Nacional, SEN) for which the generator shall be paid at market rates. Regulations for collective distributed generation are currently under consultation and are expected to be published later this year, which will allow power plants to be associated with more than one load center; thus, more users will be able to benefit from the energy produced, being able to freely agree with the owner of the plant the price conditions governing the supply.

This scheme is adequate for residential use and for businesses with an electricity consumption of approximately 0.5 MW, such as medium to large stores, retailers, bars and restaurants, and small manufactures. Collective distributed generation will be particularly useful for medium-sized real estate developments, office buildings, and shopping centers.

Isolated supply allows the generation or import of electricity to be supplied directly to the consumer, provided that such consumers and the generator belong to the same economic interest group. Generation through isolated supply supposes the existence of a private network transmitting the electricity generated between the power plant and the end user. The facilities of isolated supply may or may not be interconnected or connected, either permanently or temporarily, to the grid for the sale of surpluses or purchase in case of shortages.

Finally, the option known as local generation allows the generation or importation of electricity for consumption by one or more end users, that may or may not belong to the same economic interest group, without transmitting the said energy through the national grid. As with the isolated supply scheme, local generation facilities may or may not be interconnected or connected to the grid for the sale of surpluses or purchase in case of shortages. Since the generator and the final consumer do not belong to the same economic interest group, the participation of a qualified services supplier is mandatory; they will act as an intermediary between the generation and supply to the final user. Even when the local generation scheme is quite similar to the regular generation scheme provided by the new market regulation, the implementation of a local generation scheme benefits both the generator and the consumer, as no transmission or distribution costs will be accrued, since the energy will not be transmitted through the grid, allowing end users to benefit from more competitive prices.

We consider that these alternative generation and commercialization schemes will continue to grow in the short term and will be of great relevance to the industry, as their flexibility allows them to satisfy the electricity supply needs of large and medium consumers, and entail significant savings in electricity charges.

Transmission and Distribution Projects

SENER has instructed the distributor (one of CFE’s subsidiaries) to execute 42 projects for the expansion and modernization of the transmission and distribution grids. These 42 projects include 23 new substations, 14 extensions and five substitutions to existing distribution substations, with a total investment of MXN 2,918 million, to be executed over the following two years.

Other projects to expand and modernize the transmission and distribution capacity include: (i) increasing the transmission capacity to deal with increased demand in Cancun and Riviera Maya; (ii) implementing a project for the compensation of reactive power in Bajio; (iii) increasing transmission capacity from the North-east region to the centre; (iv) developing the South-east-Peninsular Interconnection; (v) solving capacity restrictions in underground lines in the North-east; (vi) acquiring and installing of electricity meters and connections, as well as replacing damaged and obsolete equipment in order to comply with the necessity of covering the increase in demand and load centres for residential, commercial, industrial, public lighting and service users, with an investment of MXN 20,387 million; (vii) interconnecting Holbox Island, located in Quintana Roo, which involves the construction of a 60 km aerial circuit and a 10.5 km underwater circuit; (viii) replacing 112 transformers in distribution substations for high and medium voltages, 1,021 medium voltage switchgear in substations and 4,491 distribution transformers from medium to low voltage; (ix) substituting submarine cable for the electricity supply to the Municipality of Isla Mujeres with an estimated investment of MXN 252 million; and (x) replacing5.4 million obsolete electricity meters, which represents an investment of approximately MXN 7,000 million between 2019 and 2023.

Private Energy Auctions

The new administration has put on hold the public mid and long-term energy auctions, which have been successfully implemented since 2015, arguing that it will review the process, as well as the progress made by the winners, before continuing with further auctions. Nonetheless, specialized private organizations are looking to implement private auctions as an alternative for generators and consumers.

These auctions will seek to promote investment in power plants which (i) use clean energies, (ii) have steady capacity technologies, and (iii) offer the lowest possible costs, looking to increase the development of additional physical resources and financial mechanisms to add flexibility and liquidity to the SEN and to the MEM.

The structure of the electric power sector in Mexico includes several aspects discussed in detail below.

FIG. 1. Electricity market.

Generation

On 29 January 2016, the new wholesale electricity market was launched with six subsidiaries, one nuclear business unit and other private generation companies. Installed capacity in Mexico amounted to 75 685 MW, with 70.5% from conventional power plants and 29.5% from clean power plants in 2017. Installed capacity rose 3% compared to that of 2016. Clean energy installed capacity rose by 1148 MW, a surge of 5.4%, mostly due to new wind power plants (464 MW). Conventional power plants totaled 1027 MW, a 2% relative increase to 2016. Up to 57.2% of the installed capacity was owned by CFE and the remaining 42.8% by other generators. During 2017, 329 162 GWh was generated, 3.1% more than in 2016.

In 2016–2017, installed capacity in conventional technologies increased by 1027 MW or 2%. Almost 97% of this increase is related to the expansion of combined cycle plants (810 MW) and internal combustion (182 MW), that is, an annual increase of 3% and 12.5%, respectively.

Source: PRODESEN 2018–2032.

Transmission

The entire transmission and distribution network in Mexico are owned by CFE. The transmission system is operated by the independent system operator CENACE. The overall electricity system is referred to as the national electricity system. The national interconnected system covers the main transmission network of Mexico, excluding Baja California and Baja California Sur.

Electricity is transmitted over long distances in the transmission grid, which can lead to high thermal losses. Reducing network losses is therefore an important objective for dispatching. In 2017, high voltage lines of 161–400 kV covered 52 606 km and lines of 69–138 kV covered 51 059 km. Mexico City forms a central node in the high voltage network.

Source: PRODESEN 2018–2032.

Source: Synthesis of the CFE Directive Information, December 2016 (Síntesis de información directiva de CFE).

Distribution

CFE is currently responsible for electricity distribution. There are 16 geographical divisions in charge of distribution. At the end of 2017, the Mexican transmission and distribution grids covered an overall length of around 829 925 km, providing electricity to 98.7% of the Mexican population.

The Ministery of the Energy (SENER)

SENER is the main body responsible for the coordination of the electricity sector. There is no split responsibility between states. The department is in charge of electricity market reform, including preparing laws and decrees and implementation. It has also contributed to many of the initial decisions on market design and prepared the organization of long term auctions—responsibilities that will be transferred to the regulator or the system operator at a later stage of the reform. As part of the reform, CFE was transformed into a state productive enterprise that SENER will continue to control. SENER will also regulate its unbundling. The mandate of CRE does not allow it to control state owned companies.

The regulator

CRE’s main tasks are to calculate network tariffs (transmission and distribution) and the final basic supply tariffs, as well as other regulated activities (for example, operation of the basic service suppliers, the electricity system operator CENACE). CRE enjoys technical, operational and managerial autonomy and can dispose of its own revenues coming from a tax, not from the state budget.

The Ministry of Finance and Public Credit (SHCP)

SHCP has temporary powers to determine retail tariffs for the basic service suppliers until CRE issues the final determination methods for these. The unbundling of CFE and the introduction of regulated network tariffs are expected to increase transparency about the costs of CFE.

The National Centre for Energy Control (CENACE)

The electricity system operator, CENACE, will be the cornerstone of the future system organization. CENACE is an autonomous body, formerly part of CFE. It was created in 2014 and is responsible for operating the national electricity system and the wholesale electricity markets. CENACE does not own the transmission assets, which remain the property of CFE, but CENACE operates the wholesale electricity market to ensure least cost dispatch of all power plants in adherence to economic considerations such as free competition, transparency and market efficiency. Similar to independent system operators and regional transmission operators, it also plays a key role in the planning of the power system, including investments in transmission, defining capacity requirements, operating capacity markets and running the long-term auctions.

Table 3 shows installed capacity, electricity production and consumption in Mexico, and Table 4 contains energy related ratios.

TABLE 3. INSTALLED CAPACITY, ELECTRICITY PRODUCTION AND CONSUMPTION

		2000	2010	2015	2016	2018	2019	Compound annual growth rate (%) 2010–2019
Capacity of electrical plants (GW(e))	G/N
Thermal		29.15	39.041	40.37	40.89	39.95		0.003
Nuclear		1.36	1.36	1.5	1.61	1.608	1.608	0.021
Hydro		9.62	11.5	12.02	12.09	12.125		0.007
Wind		0	0.085	0.086	0.086	0.697		0.301
Geothermal		0.85	0.965	0.874	0.874	0.873		(0.012
Other renewables*		—	—	0.006	0.006	0.006		—
Total		40.98	52.951	54.856	55.556	55.259		0.005
Electricity production (TWh)	G/N
Thermal		145.52	192.09	212.97	218.61	208.70		0.010
Nuclear		8.22	5.88	11.57	10.57	13.55		0.110
Hydro		33.08	36.74	30.12	29.14	30.54		(0.023
Wind		0.01	0.166	0.2	0.19	0.12		(0.038
Geothermal		5.9	6.62	6.29	6.03	5.25		(0.029
Other renewables*		—	—	0.012	0.013	0.01		—
Total		192.73	241.50	261.16	264.55	258.18		0.008
Total electricity consumption (TWh)		182.8	207.947	212.2	218.9	—		—

Source: Comisión Federal de Electricidad (CFE).

*Includes efficient cogeneration as a clean energy.

—: no data available.

TABLE 4. ENERGY RELATED RATIOS

	1980	1990	2000	2010	2015	2016	2017
Energy consumption per capita (GJ/capita)	59.6	59.3	66.1	72.3	70.4	74.7	74.86
Electricity consumption per capita (kWh/capita)	785.4	1101.1	1539.6	1862.2	2055.5	2126.8	2103.9
Electricity production/Energy production (%)	0.04	0.05	0.07	0.11	0.14	0.15	—
Nuclear/Total electricity (%)	0.0	2.4	3.9	2.4	4.4	4.0	4.0
Ratio of external dependency (%)	1.54	1.59	1.42	1.13	0.97	0.84	0.76

Source: System of Energy Information/SENER (http://sie.energia.gob.mx/).

The National Commission for Nuclear Energy (CNEN) was established in 1956 to pave the way to introduce nuclear power and nuclear applications in Mexico. CNEN encompassed all nuclear activities in the country (exploration for uranium, nuclear research, regulation, etc.) except for the generation of electricity by nuclear means, which was the sole responsibility of CFE, and the utilization of nuclear radioisotopes. Later, CNEN was transformed into the National Institute on Nuclear Energy (INEN), which redefined its attributions but with very few changes to its responsibilities.

In 1979, INEN was replaced by three organizations: (i) The National Institute of Nuclear Research (ININ), in charge of all the aspects related to research; (ii) Mexican Uranium (URAMEX), in charge of uranium exploration and eventually uranium production; and (iii) the National Commission for Nuclear Safety and Safeguards (CNSNS), in charge of nuclear regulation and safeguards. In 1985, URAMEX was dissolved and all its functions were passed to the Ministry of Energy.

Mexico’s interest in nuclear power dates back to the early 1960s. The first steps were taken in 1966, when a preliminary investigation of potential sites for nuclear power stations was carried out under the auspices of CFE and the CNEN. At the end of the decade, the government concluded that NPPs might play a major role in the greater energy mix. In early 1969, CFE decided to invite bids for a 600 MW(e) NPP of a proven type, and invitations to tender were sent to several manufacturers. Bids were received at the beginning of 1970, but the final decision, with up to date bids, was taken in the middle of 1972. In 1976, construction of the LVNPP was initiated, comprising two reactors of 654 MW(e) net each. The first unit went into commercial operation in July 1990 and the second in April 1995.

Figure 2 shows the current organizational structure of the nuclear power sector in Mexico.

FIG. 2. Current organizational chart of the nuclear power sector in Mexico.

As mentioned above, there is only one nuclear plant in operation in Mexico, with two boiling water reactors (BWRs). There is still a plan to add three power units towards 2029–2031, if financial means are met. PRODESEN demonstrates that 40% of the additional capacity to be installed through 2029 shall consist of clean technologies, contributing 32.552 MW. It is anticipated that up to 12% could consist of nuclear generation.

TABLE 5. STATUS AND PERFORMANCE OF NUCLEAR POWER PLANTS

Reactor Unit	Type	Net Capacity [MW(e)]	Status	Operator	Reactor Supplier	Construction Date	First Criticality Date	First Grid Date	Commercial Date	Shutdown Date	UCF for 2019
LAGUNA VERDE-1	BWR	777	Operational	CFE	GE	1976-10-01	1988-11-08	1989-04-13	1990-07-29		86.4
LAGUNA VERDE-2	BWR	775	Operational	CFE	GE	1977-06-01	1994-09-06	1994-11-11	1995-04-10		77.0

Data source: IAEA - Power Reactor Information System (PRIS).

Note: Table is completely generated from PRIS data to reflect the latest available information and may be more up to date than the text of the report.

On 26 December 2014, LVNPP Unit 2 received permission from Mexico’s regulatory authority to operate at the extended power uprate level (120% of the original licensed thermal power); it operated during 2015 at this new power level (2 317 MW(th), 805 MW(e) and 803 MW(e)) gross capacity per unit. Yet, the new operating licence at this power level has not yet been issued by the Ministry of Energy.

During 2017, the 18th refueling outage of LVNPP Unit 1 was extended from an original 40 days to 48 days. In the current operating cycle 19, the unit is operating at a power level of 2 317 MW(th) and 810 MW(e). For LVNPP Unit 2, the 15th refueling outage was planned for 43 days in 2017; the unit is operating at a power level of 2 317 MW(th) and 810 MW(e). LVNPP Unit 1 went into commercial operation in 1990 and Unit 2 followed in 1995. Both units were originally licensed for 30 years of operation. Therefore, in 2015, an application for a license renewal of both LVNPP units, allowing their operation for 30 more years, was submitted to Mexico’s regulatory authority (CNSNS). In 2020, the CNSNS will conclude the document "Safety Evaluation Report Related to the License Renewal of Laguna Verde Nuclear Station, Units 1 and 2".

An independent spent fuel storage installation, with a capacity for storing 130 dry cask storage systems, was constructed at the LVNPP site to store fuel generated during a 60 year operational lifetime. CFE plans to store 1157 spent fuel bundles in 13 dry cask storage systems between 2018 and 2021.

As a result of the Fukushima events in March of 2011, the CNSNS requested LVNPP to take action to enhance the safety of the reactors following the orders issued by the United States Nuclear Regulatory Commission, listed below:

1. EA-12-049: Issuance of Order to Modify Licenses with Regard to Requirements for Mitigation Strategies for Beyond-Design-Basis External Events;

2. EA-12-051: Order Modifying Licenses with Regard to Reliable Spent Fuel Pool Instrumentation;

3. EA-13-109: Issuance of Order to Modify Licenses with Regard to Reliable Hardened Containment Vents Capable of Operation under Severe Accident Conditions.

Furthermore, in accordance with the international community, the CNSNS requested LVNPP to reassess its safety margins in the form of a stress test. This reassessment is set to measure the ability of LVNPP to withstand damage from hazards such as earthquakes, flooding, terrorist attacks or aircraft collisions that challenge plant safety functions and may lead to a severe accident. To comply with the regulatory requirements requested by the CNSNS mentioned above, LVNPP developed flexible and diverse mitigation strategies to cope with beyond design basis events caused by extreme external events such as earthquakes and hurricanes and the loss of large areas of the facility due to large fires and explosions from any cause, including beyond design basis aircraft impacts. These strategies will allow LVNPP to maintain or restore key safety functions for all reactors on-site with installed equipment, portable equipment stored on-site, or, when needed, portable equipment stored off-site. With the implemented strategies LVNPP has the capability to mitigate beyond design basis events by maintaining or restoring key safety functions like core cooling, spent fuel pool monitoring and cooling, repowering critical control and instrumentation buses, and containment integrity to prevent the release of radionuclides and combustible gases to the environment by preventing containment overpressure failure. As part of the post-Fukushima lessons learned, severe accident management guidelines (SAMGs) were developed by LVNPP. The SAMGs provide direction to the operators as to when actions should be taken and which strategies, of those mentioned above, will help during a severe accident scenario to terminate the progress of core damage and prevent/minimize further escalation of an accident sequence.

Not applicable.

There are no NPP development in the country.

Not applicable.

Not applicable.

Not applicable.

Not applicable.

ININ carries out actions for nuclear scientific and technological development, for the promotion, transfer, adaptation and assimilation of nuclear technologies. It also carries out research projects in response to energy sector needs and provides technical assistance to nuclear facilities. It develops disciplines from which the country could benefit in other topics for national development as well. The institute has qualified personnel, nationally and internationally recognized experts in several sciences and engineering areas, providing the ability to support multidisciplinary projects. Within the field of peaceful uses for nuclear energy, ININ has defined 11 research and development topics.

INEEL is committed to meeting energy needs through innovation, efficiency and continuous improvement of their processes, within the legal and regulatory framework applicable to the management of quality, sustainable development, labour equality and non-discrimination, environmental management, safety and health at work.

The objectives of INEEL include the following:

1. To carry out and promote scientific research, experimental development and technological research in order to solve the scientific and technological problems related to the improvement of the electrical industry;

2. To contribute to diffusion and implantation, within the electrical industry, of those technologies that best adapt to the economic development of the country;

3. To maintain effective relations with similar institutions in other countries and with academic and technological research institutes in the country;

4. To provide courses of specialization and update knowledge in science, technology and industrial administration in the area of the electrical industry;

5. To provide advice to CFE, the electrical manufacturing industry and engineering and consulting services related to the electrical industry;

6. To propose to the SENER and CFE applied and technological research programmes, and the corresponding plans of operation, investment and financing in the short, medium and long term;

7. To patent and license developed technologies and the results of the research obtained, as appropriate.

None.

Mexico is a member of the World Association of Nuclear Operators, the Institute of Nuclear Power Operations, the Electric Power Research Institute and the OECD Nuclear Energy Agency and is an observer in the International Framework for Nuclear Energy Cooperation.

The legislative and regulatory framework is based on the Political Constitution of the United Mexican States (hereinafter called “Constitution”) from which a series of laws, regulations and standards are derived.

The Constitution, in its Article 27, establishes that nuclear energy must be used only for peaceful applications and that the use of nuclear fuels for the generation of nuclear energy, as well as the regulation of its application in all areas, falls within the purview of the Mexican State.

In accordance with the Constitution, in its Article 28, the generation of electric power by nuclear means is considered strategic. The public sector is exclusively responsible for such activity, and therefore, the Mexican State has created the organizations and companies necessary for the effective management of such strategic areas under its responsibility.

The Regulatory Law on Nuclear Matters of Article 27 of the Constitution (hereinafter called “Nuclear Law”) entered into effect on February 5, 1985 and gives the Federal Electricity Commission (hereinafter called “CFE”) exclusively, the right to generate electric power from nuclear fuels.

The CNSNS a deconcentrated body under SENER, CNSNS serves as the regulatory body responsible for overseeing nuclear and radiation safety, physical security, and the safeguards within the national territory. By way of SENER’s Internal Regulations, these responsibilities have been delegated from the Ministry of Energy to the Director General of CNSNS.

The Nuclear Law and SENER’s Internal Regulations empower CNSNS as the responsible agency for reviewing, evaluating and authorizing the bases for the siting, design, construction, operation, modification, cease of operations, definitive shutdown, and decommissioning of nuclear and radioactive installations, as well as everything related to the fabrication, use, handling, storage, reprocessing and transport of nuclear fuels and/or materials, radioactive materials and equipment containing them. Furthermore, everything related to processing, conditioning, dumping, and storage of radioactive wastes and any disposal of them is regulated by CNSNS.

According to the provisions of the Nuclear Law, Chapter IV Articles 25 and 28, and Chapter VI Article 50 Fractions III, IV, V, VII and XIII, CNSNS has the authority for reviewing, evaluating and authorizing the bases for the siting, design, construction, operation, modification, cease of operations, definitive shutdown, and decommissioning of nuclear and radioactive installations; has the authority for everything related to the manufacture, use, handling, storage, reprocessing and transport of nuclear materials and fuels, radioactive materials and equipment containing them; and has the authority regarding the processing, conditioning, dumping, and storing of radioactive wastes, as well as any disposal of them.

During the siting authorization, CNSNS reviews the most important aspects related to the site where the installation will be built (for example, the parameters that may affect the design), including the site seismology, severe weather (probable maximum hurricane) and other aspects of interest. Information concerning the current and future distribution of the population is also reviewed.

Subsequently, in accordance with the provisions of the United States of America 10 CFR for the licensing process, two stages have been established. The first one starts with the formal delivery of the Construction Permit Application including a description of the characteristics of the installation and especially the safety systems provided to ensure that installation will not represent an undue risk. The documents submitted to CNSNS by CFE to support LVNPS application, are the following: (1) Preliminary Safety Analysis Report (PSAR) and (2) Preliminary Environmental Impact Assessment Report (PEIA).

During this stage, CNSNS reviews the design criteria (structural, system and component – SSC - characteristics, nuclear analysis, etc.) and particularly all the issues related to the impact of the site characteristics on the SSC design of the installation and the impact of the installation on the environment.

During the review stage CNSNS may require Request for Additional Information to clarify or to supplement the safety reports. Once the review is finished, a report is prepared containing the CNSNS technical opinion on the Construction Permit application and is sent to the Ministry of Energy. Based on CNSNS opinion SENER may to issue the construction permit. The report includes recommendations and conclusions about the installation’s safety.

During LVNPS construction, CNSNS through audits and inspections supervised this phase to assure that the installation was built in accordance with the safety analysis report and the conditions set by the aforementioned construction permit.

Once the detailed design of the installation is finalized, the License for Commercial Operation can be requested. This requires that another detailed report on the plant’s safety be sent to CNSNS. This report is called the Final Safety Analysis Report (FSAR). This document contains the same information as the Preliminary Safety Report (PSAR); however, the information is no longer generic but specific to the installation. Also, a Final Environmental Impact Report (FEIR) is prepared, which includes the environmental monitoring programme to be operative during the whole plant lifetime, to monitor the effect that the installation will cause on the environment. All the measurements performed during at least five years prior to the plant´s operation is used as reference.

The FSAR review by CNSNS includes assessing the actual operation conditions. The acceptance criteria for pre-operational testing, start-up testing (as well as its impact on the accident analysis) and during commercial operation (in the preliminary report they were generic) are reviewed also. The proposed Technical Specifications (TS) are also examined which, once approved by CNSNS, are part of the License for Commercial Operation to govern the operation of the installation. The scope of activities for the inspection of the major safety components that will be performed during the plant’s lifetime (In-Service Inspection) is also evaluated. The adequacy of the training of the installation’s operation personnel are verified by examinations.