Mexico needs to rely on natural gas to make the transition to the use of renewable energy

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Mexico needs to rely on natural gas while beginning its energy transition path to a larger use of renewable energy, the CEO of Valia Energia, one of the largest private power companies in Mexico, said on Thursday, March 21st.

The Latin American country has a presidential election in June with frontrunner Claudia Sheinbaum outlining a low-carbon energy policy that would encourage renewable energy projects, a change from current carbon-intensive policies led by President Andres Manuel Lopez Obrador.

“Transition is not renewable. Energy transition is sustainable energy,” said Narcis de Carreras, CEO of Valia Energia, at the CERAWeek energy conference in Houston. “Natural gas continues to be a central part of the composition.”

To achieve its energy transition goals, Mexico must address a long-standing pause in licensing, including the suspension of a key bidding round for shale gas areas off the country’s coast that had been planned to ease Mexico’s large gas deficit, analysts have said.

Earlier this week, Sheinbaum said Mexico’s energy demand growth would be met through renewables, and added that state oil company Petroleos Mexicanos could participate in the exploration of lithium and production of renewable energy.

“We see a more pragmatic agenda, a more realistic, more practical, and more problem-solving mindset, which I think is what the country needs for the challenges we have,” de Carreras said, referring to the candidates’ agendas.

During Lopez Obrador’s administration, the use of coal and fuel oil for power generation has increased, policies to promote larger consumption of cleaner motor fuels have been delayed, and some emissions have increased, according to public and private data.

His government also has prioritized projects by Mexico’s state-owned companies while injecting them with capital, reducing the role of the private sector in the energy industry.

“To return to one of the schemes that has been successful in the energy sector in Mexico, which has been deprived of the public-private collaboration. That’s our expectation,” de Carreras added.

Valia Energia operates natural gas-fueled power generation plants in the states of Tamaulipas, Coahuila, and Estado de México, and a gas line.

Source: El Financiero

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