Two possible solutions to Mexico’s increasingly unstable power grid are increasing national natural gas production and greater private participation in the sector, according to recent reports by experts at Rice University’s Baker Institute for Public Policy and the Atlantic Council.
In May, Mexico suffered from widespread Power outages in 21 of the country’s 32 states amid a heatwave and drought that left thousands of residents without power. The outages, the first of their kind in years, rocked the energy sector and sparked concerns that Mexico’s hopes for a nearshoring investment boom would be dashed by unreliable electricity supplies.
Nearshoring — moving manufacturing and supply chains from China to North America to more easily reach the U.S. market — is seen as an economic opportunity for Mexico that has never been seen in this generation. However, the country’s unstable energy sector “will likely hinder the country’s ability to capitalize on this historic opportunity,” according to a recent report by several experts at Rice University’s Baker Institute for Public Policy.
