Mexico’s president slams opposition for voting down power bill

Bill backed by President Andres Manuel Lopez Obrador sought to give state-run utility 54 percent of electricity market.

Mexico’s President Andres Manuel Lopez Obrador has slammed opposition legislators for voting down a planned constitutional overhaul of the country’s power system, which had emerged at the centre of diplomatic tensions with the United States.

Lopez Obrador has spent months championing the bill that would have tightened state control of Mexico’s power market, but opposition legislators united on Sunday night to defeat the legislation that needed a two-thirds majority to pass.

“I believe that yesterday was an act of treason against Mexico committed by a group of legislators who, instead of defending the interests of the people … became outright defenders of foreign companies,” Lopez Obrador said during a regular news conference on Monday.

The changes would have ensured that the state-owned Federal Electricity Commission (CFE) has at least 54 percent of the electricity market – a move the government says is needed to prevent soaring power prices.

But Lopez Obrador’s plans had alarmed the US and Canada and prompted warnings that Mexico would be in danger of violating its trade commitments by favouring state-run entities heavily dependent on fossil fuels.

Opposition legislators react in Mexico's lower house of Congress
Opposition legislators react after a reform of the electricity sector failed to pass the lower house of Congress, Mexico City, April 17, 2022 [Luis Cortes/Reuters]

Washington also had said the reforms risked bringing “endless litigation” that would impede investment and undermine joint efforts to fight climate change.

“Mexico’s energy policies damage the environment, US business and investor interests in multiple sectors, and hamper joint efforts to mitigate climate change,” US Trade Representative Katherine Tai said last month, according to her office.

But after a marathon session, the lower house of Mexico’s Congress on Sunday voted 275 to 223 in favour of the measure, well short of the 333 votes Lopez Obrador’s Morena Party needed for constitutional changes.

The vote marked one of the few legislative setbacks Lopez Obrador has suffered since taking office in late 2018.

The bill’s failure represents “a big defeat for Morena and Lopez Obrador because it is one of the central axes of their project to nationalize energy”, Jose Antonio Crespo, a political analyst at the Center for Research and Teaching in Economics, told the AFP news agency.

But Lopez Obrador struck a defiant tone on Monday, pledging “this is just the beginning” and urging legislators to get behind a separate bill he wants debated that will nationalise Mexico’s lithium reserves.

Under the lithium bill, Mexico would reserve the sole right to exploit the metal via a state-run company and would not grant any concessions, the president said. Mexico does not currently have any commercial production of lithium.