The Energy Regulatory Commission (“CRE”) published modifications to the General Administrative Dispositions that set forth terms and conditions to request the authorization to modify or transfer electricity generation permits or electricity supply permits, contained in the resolution number RES/390/2017 (the “Dispositions”).

Last Wednesday, October 7th, 2020, CRE published in the Official Gazette of the Federation, certain modifications to the Dispositions, in order to grant legal certainty to the activities carried out under the -now abolished- Law for the Electric Energy Public Service (the “LSPEE”), taking into consideration that, according to CRE, the Dispositions did not define clearly the way in which permit holders should continue carrying out activities directed towards satisfying partners’ or beneficiaries’ own needs under the LSPEE, as well as related to market structure and competence under the Electric Industry Law (the “LIE”).

Said modifications to the Dispositions mainly consist in the following:

· No modifications shall be made to generation and supply permits in connection to charge centers that have executed a basic supply contract under the LIE.

· Regarding changes of the individuals authorized as the beneficiaries of the electricity, modifications were made to the requirements that need to be presented, as well as regarding establishments associated to cogeneration; particularly, regarding the inclusion of new individuals not previously contemplated within expansion plans.

In connection to the above, the Federal Economic Competition Commission (“COFECE”) issued observations and recommendations regarding the modifications made to the Dispositions, in which COFECE considered that these modifications may result in an adverse for economic competition since it considered that these modifications may create uncertainty for investors, that it limits the chances for competition within the electricity market and that it grants an exclusive advantageous position for CFE Suministro Básico.

In consideration of the foregoing, COFECE recommended to summit, the modifications to the Dispositions, to the Regulatory Impact Analysis Procedure (AIR, in Spanish) in order to analyses the modifications’ effects prior to their publication. Notwithstanding, the modifications were published without being subject to the AIR Procedure.

Should you require specific advice regarding the obtention or modification of a generation or supply permit, please do not hesitate to contact any of the members of our Infrastructure & Energy practice team.

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