LatinNews Daily - 05 February 2021

In brief: Warnings of more uncertainty due to electricity reform in Mexico

* Roxana Muñoz, infrastructure analyst for international credit ratings agency Moody’s Investors Service, has described as “positive” the recent ruling by Mexico’s supreme court (SCJN) which found that aspects of the electricity market regulations published by the energy ministry (Sener) were unconstitutional. However, Muñoz said that “uncertainty persists due to the initiative presented to reform the law on electrical energy”, which President Andrés Manuel López Obrador sent down to congress on 1 February and which would prioritise the supply of energy to the national grid from the state-run electricity firm Comisión Federal de Electricidad (CFE) over private renewable energy companies. These concerns are shared by other credit ratings agency like Fitch Ratings, which in a 2 February statement warned that “changes to sector operating rules have created uncertainty that could damage Mexico's attractiveness for investors”. Fitch believes Mexico “requires considerable private investment in its electricity sector to accommodate demand growth and prevent financial pressure on CFE”.

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