• 10 February 2020

The Ministry of Energy published an update to the Transition Strategy to Promote the Use of Clean Technology and Fuels

February 7, the Ministry of Energy (“SENER”) published the Accord by which the Ministry of Energy approves of and publishes the updated Transition Strategy to Promote the Use of Clean Technology and Fuels, in terms of the Energetic Transition Law. (The “Accord”) in the Federal Official Gazette. The strategy is one of the cornerstones foreseen by the Energetic Transition Law ( “LTE” by its acronym in Spanish) to regulate the sustainable use of energy, as well as the Clean Energy obligations (as defined in the LTE) and the reduction of contaminating emissions in the Electricity Industry, maintaining the competitiveness of the productive sectors.

From the analysis of the more than 100-page document, two main themes can be identified. First, that the government has the intention of abiding by the renewable energy objectives set forth in the LTE. Second, the government will seek that the development of the Energy Sector makes the country self-sufficient, in other words, to acquire energy autonomy.

The Accord contains a detailed analysis of how the energy sector has evolved in the past few decades and it identifies the best energy practices on a global scale. Furthermore, it sets forth projections in a medium (15 years) and long term (30 years) basis. It is estimated that by 2033, 39.9% of the electricity in the National Electric System will come from renewable sources.

From the conclusions set forth by the Accord, we can emphasize some key points that allow us to envision the government´s strategies for the Energy Sector.

• Energy generation from fossil fuels with more efficient technologies and policies that reduce energy-waste.

• A higher efficiency in the use of renewable energy. Massive growth of the renewables´ sector, reaching 39.9% in the National Electric System by 2033.

• Growth in the Energy Sector in pursuit of energetic self-sufficiency.

• A change in the structure of the National Electric Sector that will reflect a transition from big centralized power plants to a scheme that includes small generators and a decentralization that minimizes costs.

• More participation in isolated supply and distributed generation schemes.

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