On April 29, 2020, Mexico’s independent system operator (“CENACE”) notified generators of its decision to indefinitely suspend all legally mandated pre-operation tests for solar and wind projects in light of the COVID-19 pandemic. Such suspension purportedly seeks to safeguard the national grid against system interruptions clean intermittent energy projects could cause during the pandemic, and essentially bars any such projects from connecting to the grid until further notice. According to industry groups AMDEE and ASOLMEX, CENACE’s actions impact a total of 44 solar and wind projects (28 that are ready for commercial operation and 16 that are under construction), which represent approximately US$6.4 billion in investments.
Less than three weeks later, on Friday, May 15, the Agreement setting forth the Policy of Reliability, Safety, Continuity, and Quality of the National Electric System (“Policy”) was published in the Official Gazette of the Federation by the Ministry of Energy (“SENER”). The Policy cites as its primary objective the establishment of guidelines allowing competent authorities to guarantee the national grid’s electricity supply based on principles of reliability, insisting that clean intermittent energy poses a threat to such security and reliability. Much like CENACE’s suspension, the Policy primarily impacts those solar and wind projects not yet in commercial operation, but it may also impact in-the-fence projects that intend to connect to the national grid.