Mexico had 52 gigawatts of installed electricity generating capacity in 2005. The country generated 240 billion kilowatthours (Bkwh) of electric power in 2005. Conventional thermal generation represents the overwhelming majority of Mexico’s electricity generation, though the mix from these sources is gradually shifting from oil products to natural gas. Mexico consumed 183 Bkwh of electric power in 2005.

State-owned Comision Federal de Electricidad (CFE) is the dominant player in the generation sector, controlling about two-thirds of installed generating capacity. CFE also holds a monopoly on electricity transmission and distribution outside of Mexico City and some other municipalities; within those areas, state-owned Luz y Fuerza Centro (LFC) holds a monopoly on distribution activities. The Comision Reguladora de Energia (CRE) has principle regulatory oversight of the electricity sector.

Changes to Mexican law in 1992 opened the generation sector to private participation. Any company seeking to establish private electricity generating capacity or begin importing/exporting electric power must attain a permit from CRE. CFE also operates Mexico’s national transmission grid, which consists of 27,000 miles of high voltage lines, 28,000 miles of medium voltage lines, and 370,000 miles of low voltage distribution lines.

In the past, fuel oil and diesel fuel represented the largest share of the feedstock in Mexico’s conventional thermal generation mix. However, natural gas consumption for electricity generation has risen dramatically in recent years, and natural gas is now the dominant feedstock: according to Mexico’s Energy Secretariat (Sener), Mexico consumed 735 trillion Btu of natural gas for electricity generation in 2006, versus 475 trillion Btu of petroleum products. This shift has been the principle driver behind Mexico’s rising natural gas consumption. Coal consumption by the electricity sector has also risen in recent years, reaching 300 trillion Btu in 2005.

Mexico has a single nuclear power plant, the 1,400-MW Laguna Verde nuclear reactor in Veracruz, operated by CFE. In April 2007, CFE awarded a contract to an international consortium headed by Alstom to modernize the plant and increase generating capacity by 20 percent. Hydroelectricity supplied 13 percent of Mexico’s electricity generation in 2005. The largest plant in the country is the 2,400-MW Manuel Moreno Torres in Chiapas.

CFE operates two wind power facilities, La Venta and Guerrero Negro, with combined capacity of 3 MW. In March 2007, CFE La Venta II came online, adding 83MW of generating capacity to the wind park. CFE has launched a tender for a third phase of the project, which would add an additional 100MW of capacity. The Cerro Prieto complex is the largest geothermal facility in Mexico, consists of four plants with a combined capacity of 720 MW.

Mexico has an active electricity trade with the United States. Mexico exported 1.14 Bkwh of electricity to the United States in 2006, while importing 0.87 Bkwh. Many companies have build power plants near the U.S.-Mexico border with the aim of exporting all generation to the United States. There are plans to connect Mexico with Guatemala and Belize as part of the Sistema de Interconexion Electrica para America Central (SIEPAC). The plan is part of a larger effort, the Plan Puebla-Panama, to create an integrated electric power market in Central America.