Mexican government buys 13 power plants from Iberdrola

• 1 year, 7 months ago (2023-04-05)
• David Flin

Gas 393 Latin America 80

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The Mexican government has agreed to buy 13 power plants from Iberdrola of Spain in a deal valued at $6 billion. Andres Manuel Lopez Obrador, President of Mexico, said that the agreement will give state-owned power company Comision Federal de Electricidad (CFE) majority control over the electricity market.

Lopez Obrador said: “This means we’re rescuing the Comision Federal de Electricidad, and it’s a new nationalisation of our electric industry.”

The deal is scheduled to be completed within five months, at which point the CFE will operate the plants, although the vast majority of the capacity was already under contract to be sold to it.

The Iberdola power plants, mostly gas-fired, but also including a wind farm, generates power equivalent to nearly 10 per cent of Mexico’s total installed capacity in 2020, according to Mexican official data.

Lopez Obrador said that the plant acquisition deal with take CFE’s power generation to nearly 56 per cent of Mexico’s total, from about 40 per cent. He had previously stated that the state must control at least 54 per cent of generation.

Iberdrola said in a statement that it had signed an MOU with asset manager Mexico Infrastructure Partners to sell over 8400 MW of capacity from its gas-fired plants, plus its 103 MW wind asset La Venta III.