Mexico reinstates conditions for Clean Energy Certificates (CELs)

The market rules in Mexico that allow the issuance of Clean Energy Certificates (CELs) exclusively to clean energy plants that have entered into operation as of August 11, 2014 and, exceptionally, to legacy power plants (centrales legadas) that have started operations before that date but that have carried out a project to increase their clean energy production have been reestablished. The above allows the commercialization of these CELs to be more profitable for their holders and reaffirms the main purpose of the creation of the CELs market in Mexico: to encourage investment in new generation plants through generating clean energy.

As ordered by the First District Court in Administrative Matters Specialized in Economic Competition, Broadcasting and Telecommunications on March 12, 2024, the Ministry of Energy (SENER) has informed to the participants of the Wholesale Electricity Market (MEM) and to the general public that the decrees (acuerdos) issued by SENER in 2019 that distorted the supply-demand in the CELs market by allowing the receipt and subsequent offer of CELs to legacy power plants owned by the Federal Electricity Commission (CFE) that generate power from clean energy sources, even if they had entered into operation before August 11, 2014, have been rendered null and void.

CELs are certificates issued by the Energy Regulatory Commission (CRE) that certify the production of a certain amount of power from clean energy sources and serve to meet the requirements associated with the consumption of electric load centers. CELs are a market instrument whose price is determined by supply and demand, which participants may buy and sell them in the MEM through sale-purchase operations organized by the National Energy Control Center (CENACE) or trade them freely through bilateral contracts or long-term auctions.