Fossil-fuel-friendly energy policy and isolated infrastructure stifle renewable adoption in Mexico’s sun-filled Baja Peninsula » Yale Climate Connections

During the COVID-19 pandemic, Alejandro Flores Márquez got serious about making energy-saving improvements in his home in La Paz, Mexico.

As a professional sustainability consultant, he knew multiple go-to solutions that could both lower his monthly electric bill and benefit the environment.

Solar panels were high on his list of planned improvements.

But as he pursued the option, he encountered troubling, prohibitive regulations in his state of Baja California Sur. Despite being one of Mexico’s sunniest regions, this southern half of the Baja California peninsula essentially bans private solar installations from connecting to the grid.

The policy makes any investment in solar more costly and difficult for residents and businesses. Some who are committed to this green path go fully off-grid, but that means missing out on the option to sell extra power generated back to the utility and recoup some of the investment cost.

“It would be a ton of batteries and a ton of panels,” Flores Márquez said of his solar install options.

So he went in a different direction. He remodeled his home, literally knocking down walls for improved airflow, raising some ceilings, and adding large, strategically placed windows and doors. He also made simple modifications like installing all LED lighting, partitions in rooms, and energy-efficient appliances.

The changes made big improvements to his home value and energy bill while improving the layout and design. But they also required a lot of money and knowledge.

“There are options. But they’re expensive,” he said.

Also, none of these improvements do anything to advance renewable energy use in Mexico. The country has been increasingly favoring fossil fuels throughout its power infrastructure in recent years — though that could change with the recent election of a new president, Claudia Sheinbaum, whose energy plan includes a push for renewables.

Mapping the most expensive energy in Mexico

Across Mexico’s sun-soaked landscape of deserts, coastal shores, and growing cities, Baja California Sur is the only state isolated from the national electric grid, due largely to its geography as a peninsula. As such, its growing population of approximately 850,000 residents can face electricity costs up to four times higher than the national average.

Many of those living in this subtropical desert region between the Pacific Ocean and the Gulf of California must also endure seasonal blackouts. These outages within a vulnerable, aging power network often coincide with hurricane season and extreme summer heat as energy demand surges to run air conditioners and other cooling appliances.

In theory, adding a small-scale solar system to homes or businesses could relieve the load on the system and provide consumers with backup or primary energy that is green. Except the state bans the bidirectional meters that are common elsewhere in the country and other nations.

These meters — combined with an agreement with utility companies — typically help facilitate credits or payments for any excess power generated by a user and supplied back into the grid. The net metering model is a key incentive for many people to install private solar systems and pay off the cost.

In Flores Marquez’s situation, he estimated the lack of net metering would have doubled how long it takes to pay off a home solar system.

Reliance on fossil fuels

Adding to the frustration for many in Baja California Sur, the bulk of the costly electricity generated by the federally owned utility continues to come primarily from burning imported fuel oil, which is one of the dirtiest energy sources for the planet and polluter of local air quality.

As of 2022, an estimated 86.5% of Baja California Sur’s electric capacity was generated from fossil fuels compared to 13.5% from renewables, according to the Baja California Sur nonprofit Centro de Energía Renovable y Calidad Ambiental.

“What we’ve done is stop taking advantage of the great resources we have in the region, which are our natural resources — wind, sun, the tides — which could be a sufficient resource,” said Jaqueline Valenzuela Meza, the nonprofit center’s executive director.

Among its multiple programs, her organization provides access to renewable consultants for residents and communities who want to implement fully off-the-grid solar systems. The legal necessity to disconnect from the public utility typically adds significant costs for battery storage if residents want to maintain power after sundown.

The complex energy dilemma here highlights how a mix of federal policies and isolated, fossil-fuel-based infrastructure can perpetuate vulnerability and economic burden for residents navigating a rapidly changing climate.

No ability to exchange energy flow

The power supply and network in Baja California Sur is owned and managed by the Federal Electricity Commission, the same government enterprise that distributes power across all of Mexico.

The key difference with the Baja California Sur system is that it lacks connection to grids in neighboring regions or countries. That means no ability to trade energy through agreements with other operations, which is a common practice to help utilities manage the ebb and flow of power demand. Even in the northern state of Baja California, for example, the power grid is connected to systems in the state of Sonora and the southwestern U.S.

“We are the only place that has isolated systems in the country,” Valenzuela Meza said.

This limitation — with nowhere to send potential excess energy that is generated — is one of the commonly stated reasons why bidirectional meters are banned in Baja California Sur. But many question why that excess energy isn’t invited to offset the abundance of fossil fuel burning at the Federal Electricity Commission power plants in the capital city of La Paz.

One of Centro de Energía Renovable y Calidad Ambiental’s related priorities is implementing a live air-quality network throughout La Paz and nearby communities. That’s because deteriorating air quality attributed to the power plants has become a major issue as energy demand rises alongside regional growth.

The nonprofit also started a petition to challenge the law that is deterring private solar adoption.

A national drop in renewables

Throughout Mexico, renewable energy use has decreased across the national power sector for the past two years — and not by accident.

Falling from a peak of around 27% in 2021, the portion of electricity generated from renewables dropped close to 20% throughout 2023, based on data collected by the nonprofit think tank Iniciativa Climática de México.

That’s largely because outgoing President Andrés Manuel López Obrador has advanced natural gas and other fossil fuels in lieu of green energy through multiple projects in recent years. These include a massive new oil refinery in his home state of Tabasco and tapping deep-water gas fields off the coast of Veracruz. His administration has also largely stopped issuing permits for private renewable energy projects such as solar or wind.

These actions coincided with a political commitment to reclaim energy supply and operations from private corporations and foreign interests.

“The administration has a vision for much more state participation and control,” says Luisa Sierra Brozon, director of the energy branch at Iniciativa Climática de México.

Moving climate targets

Casualties of that national shift in the country now include some tense international relations and slipping commitments to cut emissions of climate-warming gasses and ramp up renewable energy production. One such target, as outlined in Mexico’s energy transition law, committed to using 35% renewable energy sources to power the country’s electric grid by 2024.

As that deadline approached with numbers falling short, the federal government last year redefined “clean energy” to include cogeneration technologies. This essentially props up the use of fossil fuels at electric generation facilities that combine heat and power for more efficient operations.

“If we follow this rhythm, it is a rhythm that is not going to achieve the goals,” said Sierra Brozon. “We are already seeing the climate impacts … [such as] breaking the record again for the hottest day in Mexico City.”

Alternative options for citizens

Though the political and infrastructure puzzle can add a burden for residents seeking to prioritize the climate and lower power bills, smaller bite-size options still exist.

Key cost-saving alternatives to renewable energy include strategies like replacing all light bulbs with energy-efficient LED bulbs, adding strategic shading features on the exterior of a home or building, and replacing old appliances. The Centro de Energía Renovable y Calidad Ambiental offers an online energy calculator to estimate consumption costs.

Flores Márquez also updated aging wiring in his home breaker box, which he says was losing energy through inefficient connections. Another creative strategy for any home is adding room dividers, such as thick curtains or roll-down shades, so you can isolate cooling and heating to a space you are occupying.

The advantage of these types of incremental modifications is that cost savings accumulate every month via energy bill savings.

Still, factors like blackouts will remain beyond consumers’ control until system changes occur within energy regulations and the power infrastructure.

Come October a new president will have the chance to refine Mexico’s energy landscape. President-elect Claudia Sheinbaum is set to take office on Oct. 1, following her historic June 2 victory that made her the first woman elected as president of Mexico. She most recently served as mayor of Mexico City and is widely known as a protégée of President López Obrador. But her credentials as a scientist set her apart, with a Ph.D. in energy engineering and contributions to the Intergovernmental Panel on Climate Change team that won a Nobel Peace Prize in 2007.

Source: yaleclimateconnections.org