Energy and the Environment

How the next government will respond to Mexico’s energy challenges, especially with regards to dwindling oil supplies, and whether they will continue Mexico leadership role on climate change and global warming will be closely followed as well.

News and Analysis

• 4/2/2012
  This news article presents the presidential candidates’ views on energy reform

• 3/26/2012: Reforma publishes a profile of the three presidential candidates’ energy proposals. As translated in “The Week in Review:”

All candidates oppose outright privatization but two, in particular, favor increasing private participation in the state-owned Pemex, and greater competition to foster efficiency:

Enrique Peña Nieto (PRI) points to the challenges of falling production rates and aging technology to stress that the current model is not sustainable. He thus calls for renewed investment in exploration and extraction, as well as for legal reforms that would help to boost the relationship between the private sector and Pemex.   By allowing for shared production and shared risk contracts, as well as greater linkages between the private and public sector, Pemex could potentially access greater capital and better technology, making it a competitive entity.

Josefina Vázquez Mota (PAN), too, emphasizes the importance of running PEMEX as a “smart business.” She argues that meetingMexico’s growing energy demands, developing new exploration and collection technology, and working with private businesses should be the top focus for the next administration. Vázquez Mota also would push to improve current industry practices and for scientific research on alternative energy sources.

Andrés Manuel López Obrador (PRD) is more skeptical of private participation. He argues that private involvement would preclude the possibility of continued economic development in Mexico.  Privatization would condemn businesses to paying exaggerated prices for energy, he emphasizes, hurting small and medium-sized enterprises in particular and disrupting economic growth and stability in general. Keeping Pemex as state-owned, on the other hand, enhances its “operational honesty” and efficiency and allows it to carry out (his would-be) government priorities: environmental sustainability, continued exploration of new sources of fuel, and investment in new technology.

• 10/10/2011: Enrique Peña Nieto (PRI) includes in his 10-point economic plan the need to ”pass reforms to make state-owned oil monopoly Pemex more competitive.”

• 9/28/2011: Mexico City Mayor and presidential contender Marcelo Ebrard (PRD) introduces the capital city’s first electric taxis, in an attempt to “promote the use of environmentally friendly vehicles in one of the world’s smoggiest metropolitan areas.”
  

• 7/2011: The Border 2012 project on environmental issues along the border:

Water quality, air quality, and natural resources suffer a disproportionate amount of environmental degradation compared to each nation’s overall environment in the border region.  The 14 metropolitan areas along the border have abysmal air and water quality.  Rapid population growth in these urban areas has lead to increased demand for land and poorly planned development; greater demand for energy, amplified traffic congestion and waste generation, overburdened or unavailable waste treatment and disposal facilities, and frequent chemical emergencies.

• 6/22/2011: Marcelo Ebrard (PRD) says an alliance between Brazil’s Petrobras and Mexico’s Pemex would be “convenient:”

Me parecería muy interesante hacer una alianza estratégica con ellos (Petrobras) pues han desarrollado una tecnología de exploración de aguas profundas. No veo por que no podemos hacer una alianza estratégica con ellos, le convendría mucho a México y otros países”, dijo Ebrard en entrevista.

• 5/2011: Duncan Wood of ITAM, CSIS and the Mexico Institute details the likely positions of the three major parties of energy reform:

The PRD is the least likely of all three parties to propose meaningful reform of the  energy  sector, having protested vehemently against the partial reforms of 2008. A PAN  president would likely try again to get far-reaching reform of the oil sector. The PRI is probably the best equipped of the parties in the sense of its ability to tackle the PEMEX union, it is the most likely to control Congress (fundamental if a constitutional change is to take place), and it has the broadest base of support among state governors (also a necessary requirement for constitutional reform). Yet the PRI also has hard-line groups within it who continue to resist

any increased flexibility in terms of private participation in the sector.

• 3/21/2011:  Josefina Vázquez Mota (PAN) on energy reform:

Pensemos en una soberanía en sentido moderno, que es más que la propiedad de un recurso como fin en sí mismo. Es la propiedad de un procedimiento, es la capacidad de innovar, es la posibilidad de aportar valor agregado, es crecimiento económico y ejercicio efectivo de ciudadanía económica. Es transformarse en un país más fuerte social y económicamente. Esa es la soberanía a la que aspiramos”, indicó.

• 11/8/2010: Enrique Peña Nieto (PRI) wrote for El Universal on his views on Pemex:

Debemos realizar una reforma fiscal integral que permita reducir los recursos que Pemex transfiere al gobierno (casi 40% de los ingresos federales). De esta manera, la empresa podría invertir parte de la renta petrolera en el desarrollo de energías “limpias”. En pocas palabras, que el propio petróleo financie el nuevo modelo energético sustentable.

• 10/28/2010: Rodrigo Camerena writes in the World Politics review about the future of Pemex:

Given Calderón’s waning time in office and the PAN’s congressional minority, public-sector reforms are unlikely to occur before congressional and presidential elections in 2012. But unless radical changes to Mexico’s energy sector are enacted soon, the country’s fate as a future net oil importer may very well be sealed.

• 3/24/2008: Voice of America on Andrés Manuel López Obrador (PRD) and Pemex reforms:

Supporters of Andres Manuel Lopez Obrador say he will find a way to rebuild the state oil industry without outside help and provide a better future for the poor. They hope his consolidation of power within the PRD will help him launch another bid for the presidency in Mexico’s 2012 election.