Rebecca Conan, Platts S&P Global

MEXICO CITY 
EnwergiesNet.com 10 13 2022

Mexico will head to the UN Cop 27 climate talks in Egypt next month with a change in government discourse this year that pays lip service to climate change action but has so far resulted in few concrete improvements.

President Andres Manuel Lopez Obrador pursued an energy sovereignty policy during the first three years of his government that actively curtailed privately owned clean energy projects while promoting increased oil and natural gas output. But following increased pressure from US president Joe Biden’s government, Lopez Obrador has begun to publicly voice support for climate change policies that can benefit state-owned companies CFE and Pemex, while also supporting marginalised communities in Mexico.

The president committed this year to the construction of a 1GW solar park, cross-border US-Mexican solar parks and cross-border transmission lines, as well as 50pc of vehicle production to be zero-emissions vehicles by 2030.

Mexico signed the global methane pledge at the last Cop in Glasgow, committing to reduce methane emissions by 30pc by 2030 from 2020 levels, and has followed up on that pledge with the announcement of a 43.3bn peso ($2.15bn) investment to reduce gas flaring by 2024.

But Pemex has been fined for unchecked flaring at its key new Ixachi development and has dragged its heels on building the required infrastructure to cut emissions. Massive methane leaks detected from Pemex’s offshore installations in December and August, combined with the operator’s choice to deny their scale, also signal the uphill battle that Pemex faces in reducing methane emissions.

Mexico also signed the Cop 26 pledge to halt and reverse deforestation given its alignment with the government’s large-scale reforestation programme. But project implementation has been problematic, with areas deliberately deforested to take advantage of payments under the new programme.

Paris pledge

As part of the Paris agreement, Mexico committed to cut emissions by 22pc by 2030 and by 50pc by 2050 against a 2005 baseline. But the government raised the level of its business-as-usual scenario in 2020, effectively increasing CO2 emissions in absolute terms. Climate action groups have repeatedly called on the government to implement more ambitious targets through its nationally determined contributions, but the government has yet to update them.

Mexico’s position on coal-fired power production is equally paradoxical, having ruled out the construction of new coal-fired plants last year, while at the same time contracting coal supply from small-scale and rudimentary mining operations.

Lopez Obrador has not yet commented on this year’s Cop. It is unclear whether Mexico will commit to a long-term phase-out of internal combustion engine vehicles given the importance of the car industry to the country’s economy.

And while Mexico does operate a voluntary carbon offset market, Lopez Obrador has admitted that it needs better regulation.

Mexico called for more financing to meet emissions targets in Latin America last year in Glasgow, arguing that access to financing is not proportional or equitable, nor does it correspond to the amount of emissions each country generates.

spglobal.com 10 12 2022