Mexican power outages enter fourth day

  • Market: Electricity, Metals, Natural gas, Oil products
  • 10/05/24

Mexican power grid operator Cenace issued its fourth consecutive day of operating alerts amid the heatwave gripping the country.

Net electricity demand reached 47,321MW early today, with deployed electricity capacity slightly below at 47,233 MW, according to Cenace.

Since 7 May, Cenace has declared emergency operating alerts as demand exceeded generation capacity during peak evening hours, prompting the grid operator to preemptively cut electricity supply across different states to maintain grid integrity.

Power outages have lasted up to several hours in Mexico City and in major industrial states as power demand has outstripped supply by up to 1,000MW. Peak demand this week hit 49,000MW, just below last year's historic peak of 53,000MW during atypical temperatures in June.

"We are very concerned about the unprecedented outages detected across 21 states, a situation that affects the normal functioning of Mexican companies," national business chamber Coparmex said.

Peak electricity demand typically rises in June-July but temperatures this week have risen as high as 48°C (118° F) across some states. Mexico City reported a record high of 34.3°C on 9 May and high temperatures are forecast to continue into next week, Mexico's national weather service said.

The inability of Mexico's grid to respond to increased demand is because of insufficient power generation capacity, non-profit think-tank the Mexican institute for competitiveness (Imco) said this week.

"Despite the energy ministry's forecast that 22,000MW of new power capacity would enter service by 2026, only 1,483MW had entered service as of 2022" since late 2018, Imco said.

President Andres Manuel Lopez Obrador's administration pledged to build new generation capacity, including five gas-fired, combined-cycle plants, but recognized this week that delays had contributed to the power outages.

"We have an electricity generation deficit because some of the combined-cycle plants were delayed, but we are working on it and it will soon be resolved," Lopez Obrador said on 9 May.

Lopez Obrador's government has also curtailed private sector power development during his administration.

Mexico needs to upgrade and expand its transmission network, industry associations say.

"In order to resolve this problem, we believe that a reopening of the electricity market to the private sector is imperative," Mexico's wind energy association, Amdee, said.

Mexico has 87,130MW of installed capacity, with 39.5pc from combined-cycle gas-fired power plants and 31pc in renewable power, including wind, solar, hydroelectric, geothermal and biomass, according to the latest statistics from the energy ministry.


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