On October 3, 2025, the Regulations of the Law of the Power Sector and the Regulations of the Law of Energy Planning and Transition (together, the “Regulations”) were published in the Federal Official Gazette.
As further described herein, these regulatory instruments provide greater detail on various aspects, notably, the figure of binding planning of the sector and its implications for private projects, the rules related to permits and authorizations of the sector, energy storage and its treatment in the market, and joint development schemes with the Federal Electricity Commission (“CFE”, per its acronym in Spanish), while strengthening the regulation on social impact, determination of rates and updating with measurement requirements.
The Regulations implement the provisions of the Law of the Power Sector (“LSE”, per its acronym in Spanish) and of the Law of Energy Planning and Transition (“LPTE”, per its acronym in Spanish), which were published on March 18, 2025, as implementing legislation of the 2024 constitutional reforms relating to the power sector. The new legal framework sets the foundations for the reconfiguration of the sector, including the creation of the National Energy Commission (“CNE”, per its acronym in Spanish) to replace the Energy Regulatory Commission, the reinforcement of the State’s authority through the stewardship of the Ministry of Energy (“SENER”, per its acronym in Spanish), and the strengthening of CFE. For further detail about the LSE and the LPTE, please refer to our client alert here.
In this context, the Regulations provide additional detail about the planning of the power sector, the manner in which the different regulated activities may be carried out, as well as the supervision powers of the different governmental authorities.
Binding planning of the Energy Sector will be carried out by SENER with the support of the Energy Planning Council, as well as that of the National Center for Energy Control (“CENACE”, per its acronym in Spanish) and CFE in certain aspects.
The Regulations provide that planning of the power sector will be carried out through several programs with horizons of short-term (six years), mid-term (15 years) and long-term (up to 30 years), which must establish the strategic framework and direction of the national energy policy.
The goals set forth in these instruments must guide binding planning towards the sustainable development of the sector, preventing the prevalence of private parties in power generation, while fostering energy transition, the development and modernization of infrastructure, energy justice, and the reduction of greenhouse gas emissions (“GHG”).
With respect to GHG from the sector, SENER must coordinate with the Ministry of the Environment and Natural Resources.
The goals defined by SENER must follow a principle of progressiveness and must be expressed in percentages, rates or equivalent indicators, specifically covering, among other aspects, the participation of clean energies in the generation matrix, the use of renewable energies by end consumers, the electrification of such end uses, the production and use of biofuels, and the reduction of energy poverty, of energy intensity in final consumption and of GHG emissions.
These goals must be aligned with the international commitments assumed by the Mexican State in terms of climate change, of the Sustainable Development Goals, and of any other international initiative of which Mexico is a part.
The Power Sector Development Plan is worth noting among the planning instruments. Such policy must take into account electricity demand forecasts and primary input prices published by CENACE and CFE, economic growth projections, criteria for the minimum cost of long term power generation and supply, the binding programs regarding the National Transmission Grid and the General Distribution Grids ( the “Grid”), policies related to accessibility, quality, and efficiency within the National Electric System (the “System”), projects to be developed by private parties, the State, or under mixed development schemes, as well as coordination with mechanisms promoting and incentivizing clean energy and the advancement of energy justice.
In this sense, the Power Sector Development Plan must include programs for the decommissioning and installation of power plants and programs for the development and modernization of the Grid, such programs to be prepared by CENACE and CFE.
For purposes of the non-prevalence of the private sector, SENER must calculate CFE’s share in power generation in February of each year, in relation to the total power that was injected into the System. Based on the results, SENER must identify the needs for additional generation, transmission and other electric infrastructure to be developed by the government and include them in the Power Sector Development Plan, as well as carry out the necessary actions for the execution of the projects contemplated therein, with the understanding that this should not affect the Economic Dispatch of Load, curb the attention of demand or increase the cost of the system.
The Regulations of the LSE also grant SENER the authority to define strategic projects to ensure compliance with the national energy policy, which must have simplified administrative procedures to allow for expedited execution.
SENER and CNE must take into account the binding planning policy when granting licenses, contracts, permits, concessions, and authorizations in terms of the LSE, the Hydrocarbons Sector Law, the Law of Geothermal Energy, the Law of Biofuels and their regulations.
SENER, in coordination with CNE, may issue requests for proposals for the granting of power generation permits for the Wholesale Electricity Market (the “Market”) required to ensure compliance with the expansion objectives of the System, in accordance with the energy sector’s planning instruments.
The Regulations of the LSE specify the authorities of CNE and SENER regarding permits and authorizations. The CNE is tasked with the authority for granting permits for power generation, trading and supply, and storage. SENER, in turn, is tasked with granting authorizations for the import and export of power.
Permit applications must be evaluated and resolved within a period of 60 business days from the date of receipt.
Among the requirements on permits, the following stand out: presenting the corporate structure of the applicant, where the persons who exercise direct or indirect control must be identified; and accrediting the right of use over the property in which the project will be located; as well as the restriction on amending permit applications by submitting additional information during the review process. Additionally, permits may be denied in the event that SENER or CNE determines, with the opinion of CENACE, that the activity in question represents a risk to the accessibility, quality, reliability, continuity, efficiency, safety and sustainability of the System or compromises the power supply.
The Regulations also empower SENER and CNE to implement simplified procedures for the granting of generation or storage permits in the case of strategic projects, or those necessary to safeguard the integrity of the System and the Market.
Persons who have been penalized with the revocation of a permit, as well as persons exercising control over such permit holders, are barred from obtaining a new permit or authorization for the same activity for a period of five years. For purposes of clarity, the Regulations of the LSE do not set forth that subsidiaries of such persons exercising control over the permit holder are affected by this prohibition.
The Regulations of the LSE strengthen energy justice as a fundamental principle for all activities within the power sector, from planning and construction to the operation and eventual decommissioning of projects, regardless of whether they are public or private in nature.
To operationalize this principle, SENER must promote mechanisms that guarantee reliable, affordable, safe, and clean access to meet basic needs, particularly for rural communities, marginalized areas, and Indigenous and Afro-Mexican peoples and communities, as well as persons in vulnerable situations.
Likewise, the Regulations provide for the creation of the Universal Energy Service Fund, which purpose will be to finance energy justice actions, prioritizing electrification projects located in marginalized communities in accordance with the operating rules issued by SENER.
SENER must design and implement an energy justice indicator system to measure the effective compliance of the objectives set forth in the actions, programs, strategies, and projects financed in the power sector. SENER must also publish the results obtained annually and update the energy justice strategies to improve their effectiveness. To broaden inclusive participation of Indigenous and Afro-Mexican peoples and communities in the value chains of power projects, SENER, in coordination with the relevant authorities, must (i) establish the actions necessary to ensure that communities have sufficient information to evaluate the impacts of projects; (ii) ensure mechanisms to provide transparency of projects with respect to the companies involved; and (iii) implement mechanisms to consider the perceptions, grievances, and demands of stakeholders, including prior, free, and informed consent.
The Regulations of the LSE provide additional rules for the schemes of self-consumption, for-Market power generation projects, and for mixed development schemes consisting of mixed investment and long-term production.
The Regulations provide BESS may participate jointly in the activities of generation and commercialization, whether or not they are associated with load centers or power plants, or may be integrated as part of the infrastructure of the Public Service of Electricity Transmission and Distribution.
BESS that are not associated with a power plant or load center and have a capacity equal to or greater than 0.7 MW require a storage permit issued by CNE, while BESS forming part of a power plant with a generation permit do not require an additional permit. BESS participating in the Market must hold a permit from CNE or an authorization from SENER, as applicable, and must be represented by a market participant.
BESS integrated into CFE’s infrastructure for the provision of the Public Service of Electricity Transmission and Distribution do not require a permit; however, such systems may not participate in the Market.
The operation of BESS must comply with the dispatch instructions of CENACE, in accordance with the general administrative provisions issued by the CNE.
The Regulations of the LSE provide that power plants under the distributed generation scheme and exempt generators can receive Clean Energy Certificates to the extent that they are represented by a Supplier and meet the measurement requirements according to their voltage level.
On the other hand, BESS will not be able to receive Clean Energy Certificates, while the obligations in this area are not applicable to these systems; however, it is not specified whether for BESS associated with clean power plants, power generation that is stored will be entitled to Clean Energy Certificates.
Projects that require an authorization or permit in the power sector must submit a Social Impact Assessment (“SIA”) for approval from SENER. The statutory term for SENER to issue a resolution is of 90 days, in the understanding that the approval will be conditioned when a free, prior and informed consultation (“FPIC”) is required and the project will be finally authorized only once the FPIC is successfully completed.
The final approval of the SIA by SENER constitutes a mandatory requirement for sponsors to commence the construction and development of a project and is a condition to start commercial operation.
The Regulations also identify specific cases in which the submission of a SIA is not required, including where: (a) the activity does not require a permit from CNE or SENER, (b) the works correspond to maintenance or modernization of existing transmission or distribution infrastructure, (c) the works involve distribution grid extensions of less than 2 km, or (d) the works are carried out to prevent or respond to imminent disasters or emergency situations.
The Social Management Plan (“SMP”) associated with the SIA must include specific investment commitments and be updated annually, considering measures for the prevention and mitigation of social impacts, shared-benefit strategies, financial resources allocated for its implementation, and, where applicable, actions related to FPIC. With respect to the amount allocated to shared benefits, it must be equal to or greater than the amount allocated to the attention of the social impacts identified in the MIS.
Once the FPIC process is concluded, the Regulations provide that project developers must follow up on the fulfillment of the agreements reached with the consulted Indigenous or Afro-Mexican community, and such agreements must also be incorporated into the SMP.
The Regulations of the LSE set forth the procedure for land use or occupation and the establishment of easements required for public transmission lines and geothermal and hydroelectric power plants.
In these cases, permit holders and/or CFE must notify SENER and the Ministry of Agrarian, Territorial and Urban Development (“SEDATU”, per its acronym in Spanish) of the start of negotiations with landowners or title holders.
To provide greater certainty to the negotiation process, SENER must issue specific regulations and guidelines governing the minimum conditions of land use, enjoyment or impact agreements, as well as the rights and obligations of the parties. In addition, the participation of social witnesses is contemplated in negotiation processes, and SEDATU is empowered to initiate mediation procedures in case of disputes concerning the mode of acquisition or the compensation offered.
The Regulations establish the framework for determining Electricity Tariffs, prices, considerations, and costs under the principles of accessibility, quality, reliability, continuity, efficiency, safety, sustainability, and energy justice, based on prudent industry practices and the binding planning. CNE, in coordination with SENER, must issue administrative provisions with the methodologies for setting rates, prices and costs of the Public Transmission and Distribution Service, of the Basic and Last Resort Supply, as well as the operating costs of CENACE, and for the Regulated Tariffs of Ancillary Services outside the Market, the costs of which will be reported by CENACE.
These provisions must include regulatory accounting with a chart of accounts and rules independent from tax, governmental, or corporate accounting, allow evaluation tools (comparisons, adjustments, and performance indicators), and promote demand and rational use.
CNE must regulate according to criteria of effectiveness, efficiency, integrity, productivity, transparency, accountability, and competition, and may apply schemes based on market conditions if they contribute to the objectives. It may also require technical, economic, financial, cost, contribution, and operational information to assess risks, the evolution of costs and subsidies, service performance and quality, and to define the tariff structure and its adjustments.
CNE will publish on its website the relevant information of the process, including the calculation workpapers and, where applicable, the disaggregation of components in the billing of Basic Supply groups with different mechanisms; while CFE and CENACE must publish their tariffs in the Official Gazette of the Federation, with CENACE being responsible for publishing the Ancillary Services not included in the MEM.
The tariffs, prices, and charges determined or approved by CNE will consist of maximum tariffs. However, Generators that provide Ancillary Services outside the MEM, CFE as carrier, distributor and basic supplier, and the Suppliers of Last Resort may agree on discounts in accordance with CNE criteria validated by SENER, subject to generality and accessibility, taking energy justice into account where applicable, and registering them with the CNE. Tariffs must include efficient service costs, taxes, transfer costs, outage and failure costs, and shared services, and a reasonable return on assets in operation, avoiding duplication across segments and excluding contribution of works to the grid.
CNE will establish methodologies to assess performance and adjust tariffs, define efficient costs by service, and monitor operating, maintenance, failure, financing, investment, extension, modernization, expansion, technological research and development, and depreciation costs, under the supervision of SENER.
The Regulations of the LSE set forth that CNE must issue contract models and methodologies for the compensation payable to Exempt Generators and Final Users of Basic Supply with Controllable Demand; and it may create coordination groups to review tariffs, with the participation of public enterprises and federal agencies, whose determinations will be indicative, with the CNE issuing its guidelines and calls.
The transitory provisions of the Regulations of the LSE set forth that power plants that complied with metering regulations that were in place when they reached their commercial operation, prior to the entry into force of the now repealed Electricity Industry Law and, due to their characteristics, partially comply with the requirements established in the regulations currently in force, must inform CNE of the status of their measurement systems, the attention programs and, where appropriate, the technical limitations for which it is not possible to comply in their entirety, so that CNE, in coordination with SENER, can establish, for each case, the periods and mechanisms to regularize these systems when required for the reliability of the SEN.
The Regulations became effective as of October 4, 2025, repealing the Regulations of the Electricity Industry Law and the Regulations of the Energy Transition Law.
Until the new implementing provisions and guidelines are issued, the existing rules and guidelines will remain in force to the extent that they do not conflict with the new legal framework. On a one-time basis, SENER must coordinate the updating of the Market Rules to align them with the objectives of the new legislation and regulation, with the participation of CNE, CENACE, CFE and, where appropriate, representatives of the private sector.
Within 120 calendar days from the effective date of the Regulations, CNE must issue the guidelines for the migration of permits and contracts granted under the formerly repealed Law on the Public Service of Electric Power to the modalities established in the LSE, such migration being optional to permit holders.
Within 180 calendar days from the effective date of the Regulations, CNE must issue the general administrative provisions governing the integration of BESS into the System.
Within 60 business days from the effective date of the Regulations, SENER must publish a call for private parties to submit generation permit applications for the development of power plants who wish for those projects to be identified as strategic and priority projects under the binding planning through 2030.
Prior to the issuance of the Power Sector Development Plan, during the last quarter of 2025, SENER will receive from any interested party proposals for generation, industrial, productive, and sectoral infrastructure projects to be considered in the binding planning process.
Pending the issuance of the new guidelines and administrative provisions referred to in the Regulations, applications for the amendment of generation permits granted under the Public Electricity Service Law or the Electricity Industry Law that seek to migrate to the framework of the LSE (including those submitted through March 18, 2025 to the now dissolved Energy Regulatory Commission and ratified before the CNE) shall be resolved in accordance with the provisions of the LSE. To that end, interested parties must submit to the CNE the relevant permit number, the legal figure to which they seek to migrate, and documentation evidencing compliance with prior obligations, inclusion of the generation capacity in interconnection contracts pursuant to the LSE, the absence of outstanding payments, and, as applicable, progress or execution of the authorized work schedule.
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