Coparmex warned of a 17% increase in electricity rates in case of approving the Electricity Reform

In the midst of the suspension of the approval of the Electricity Reform, the Employer's Confederation of the Mexican Republic (Coparmex) ruled against the initiative and warned that if authorized, it will reflect an increase of up to 17% in electricity rates in households.

Coparmex pointed out that this is a negative effect on society, since according to experts, academics, legislators and businessmen, there would be an increase for domestic tariffs and at least 150% for companies.

According to the Confederation, this is a proposal that should not be voted in favour, as it was presented, since it would allow only the Federal Electricity Commission (CFE) to buy and sell energy at the price it decides.

In this regard, they explained that in practice, the reform creates a monopoly, displaces the private sector for the sole benefit of the CFE because the private sector that today competes to generate energy could only sell it at the price and quantity that it decides to buy, which would end competition in our country.

They also expressed their concern about the electricity reform, which will be voted on next Sunday, April 17. They said that another negative point is that all existing generation permits and contracts will be canceled and those pending resolution by the CRE, a fact that is in violation of the provisions of the Administrative Procedure Act for the cancellation of permits granted by the authority. If the reform occurred, it would cancel all contracts between privates or between privates and CFE.

In addition, it would interrupt the energy transition and put at risk of compliance with international treaties signed by Mexico, including the Paris Agreement and the T-MEC.

Therefore, through a letter sent to the federal deputies, they called for this initiative not to be approved and with the aim of preventing the destruction of the electricity market.

“Legislation must guarantee light at fair prices for families, at competitive prices for companies and privilege clean energy,” they reiterated in the letter.

They insisted that their greatest concern is the citizens and asked the deputies to avoid harming the country and families with this reform.

“We call on our federal deputies not to approve the Constitutional Reform on Electrical Matters as it was presented and that in the discussion scheduled for this April 17 they listen to the voices of citizens, take into account the opinions of all sectors and vote for what Mexico needs, giving priority to reasons technical and economic aspects, as well as the well - being of all Mexicans”.

For his part, a few days ago, the President of Mexico, Andrés Manuel López Obrador, announced what are the benefits of endorsing the Electricity Industry Law, since he reiterated that is a step towards strengthening the economy of Mexicans.

“We saved the Federal Electricity Commission (CFE) and guaranteed that the price of electricity does not increase,” the president said during his traditional morning conference last Friday, April 8.

In that regard, the President gave an example around the subject and with respect to another country. “The Algerian government just told the government of Spain yesterday that the price of gas is going to increase and the price of electricity will increase, even more, because there they opted for privatization. And we, even if the Conservatives are angry, we have to put the public interest, the interest of the nation, first.”

According to official information, the Electricity Industry Act aims to promote the sustainable development of the electrical industry and ensure its continuous, efficient and safe operation for the benefit of the population.

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