Mexican Wholesale Electricity Market Report

Mon Oct 03 15:03:00 EDT 2016
By Veronica Irastorza, Elvira Creel, et al.

NERA Managing Director Dr. Agustin Ros, Principal Veronica Irastorza, and Consultant Elvira Creel recently published the Mexican Wholesale Electricity Market Report, which provides an outlook on conditions in the Mexican wholesale energy market. The Mexican Wholesale Electricity Market (Mercado Eléctrico Mayorista, or MEM) began operations in 2016. Since operations commenced, the National Center for Energy Control (CENACE), the electric system and electricity market independent operator, has been reporting the hourly locational marginal price (LMP) for approximately 2,360 nodes.

The wholesale electricity market is currently a cost-based, short-term energy market with a day-ahead market and a real-time market. Locational marginal prices for the National Interconnected System averaged US$48/MWh from February through September 2016, with a standard deviation of US$14/MWh.

The former Mexican state-owned electricity company (Comisión Federal de Electricidad, or CFE) is currently bidding as a single company while it undergoes a separation into various generation companies (CFE Gencos). In the medium term, as CFE Gencos start working independently, each one will bid separately in the MEM. More private participation is also expected.