What should Mexico do?

1

Enhance its NDC to be 1.5 degree aligned by COP26:

  • Make current GHG emissions reduction target of 22% below BAU unconditional in 2030; increase this to 36% by 2030
  • Align NDC targets and milestones to achieving the long term strategy and the net zero commitment by 2050. Develop and implement the NDC roadmap to meet the unconditional mitigation goal and adaptation commitments.
  • Mexico should desincentivise state-owned fossil fuel-fired power plants and reopen renewable energy auctions and projects
  • COVID-19 recovery should not be an excuse to reduce environmental and climate change related budget that would risk achievement of the NDC. -> Ensure achievement of the goal to increase the share of clean energy to 35% by 2024 mandated by energy transition law
  • Avoid further delays of emission standards for gasoline and diesel vehicles – Mexico have been lagging behind US standards for 10+ years
  • Establish more transparent, accountable and concrete sectoral climate objectives
    Improve transparency and participation processess in any changes to national climate actions, as well as in the monitoring, verification and reporting of the national climate progress.
2

Build a just and resilient recovery plan:

  • Establish a national carbon budget to give Mexico an emissions limit instead of reduction percentages relative to baseline
  • Incentivise renewable energy investments and the expansion of the grid. Mexico should promote renewable energy projects at different scales, ensuring social inclusion and consultation of the communities where projects will be installed.
  • Ensure implementation of REDD+ Strategy at national / subnational levels; including agreements between Ministries of Environment and Agriculture to align programs for sustainable rural development.
  • Set concrete actions to increase forest coverage or sustainable forest management as well as monitoring and evaluation assessments to the “Sembrando Vida” programme.
  • The National Forest Commission (CONAFOR) and the Secretariat for Environment and Natural Resources (SEMARNAT) should re-engage in international cooperation schemes such as the Forest Carbon Partnership Facility (FCPF) -> Ensure immediate implementation of existing methane regulations for oil and gas by PEMEX; include specific measures for F-gases reduction. Establish a plan for the phase-out of highly polluting fuels such as fuel oil and coal.
  • Increase the stringency of regulations for the transport sector and, implement the National Electromobility Strategy together with sustainable urban mobility programmes in cities; improve industry efficiency; and waste management
  • Increase and expand current carbon tax to all fossil fuels including methane
  • Increase the annual budget of public environmental agencies.
  • Establish a maximum level of fossil fuels’ consumption.

What you need to know about Mexico?

  • The National Center of Energy Control (CENACE) and the Energy Regulatory Commission are trying to limit the participation of RE that could be generated in Mexico. The government is also suspending renewable energy licenses and blocking investments in the sector
  • The government, in its aim to achieve energy self-sufficiency, is building a new refinery in Dos Bocas, which is creating a huge social opportunity costs and it could be at risk of becoming a stranded asset in less than 20 years
  • In 2021, the budget of the environmental sector is less than the one of 5 years ago. In addition, in 2021 the budget for climate mitigation and adaptation represents just 1.1% of the national budget; of which 75.3% are focused on natural gas transportation. Other agencies that have had cuts in their budget includes Planning and Environmental Policy Agency and the Commission for Protected Areas.
  • CAT estimates that Mexico will have to implement additional policies to reach its original NDC targets. The country is at risk to even increasing its original emissions baseline scenario
  • Mexico has recently set a maximum level of fossil fuel production, it is also necessary to establish a maximum level of consumption and that the country reaches its emissions peak as soon as possible.
Recovery Measures to Highlight:

  • Although COVID-19 has been discussed in Congress, no regulatory or institutional changes have been put in place to address its effects at the federal level nor has a climate justice approach been adopted to implement a green recovery plan.
  • Instituto National de Ecologia y Cambio Climatico (INECC) launched a program to estimate the increase in COVID-19 related waste and to manage both medical and municipal waste
  • INECC is assessing linkages between the pandemic and air pollution
    Mexico City already has its Climate Action Plan to set the emissions of the City in the 1.5°C pathway to comply with the Paris Agreement. The City also has a recovery plan which includes environmental aspects but its not the case at the national level.
  • There are local and state governements developing important climate change actions of decarbonization plans and instruments plans, such as Mexico City, Jalisco, Guanajuato, Guadalajara, HIdalgo, Yucatán, Puebla, Queretaro and Quintana Roo

Recent developments

Recent developments

  • Mexico’s last NDC update -submitted in 2020- merely reaffirmed previous unconditional GHG emissions reduction target of 22% below BAU by 2030 and conditional reduction of 36% by 2030. Mexico’s 2030 target is insufficient and would only limit emissions to 755 MtCO2e2. In May 2021, Greenpeace filed a lawsuit to challenge the validity of the NDC update, , and on 1st October, a Mexican court suspended the NDC on grounds of insufficient ambition under the Paris Agreement targets.
  • Strong economic development: the falling cost of RE makes it more cost-competitive than fossil fuel-based technologies. A WRI study finds that clean energy policies could result in savings of USD 5 billion in government expenditure over the next decade
  • Climate justice is social justice: the current administration has a strong social agenda, so SDG-NDC linkages co-benefits should be highlighted especially given Mexico’s vulnerability to climate change
  • Health and environmental co-benefits: climate action could improve air quality, avoiding ~26,000 deaths from now till 2030
  • Enhanced energy security: Mexico is concerned by its dependency on fuel imports, and the desire for energy self-sufficiency is leading to more investment in domestic coal, though it is not sufficient to satisfy energy needs and locks-in highly carbon intensive infrastructure. Increasing energy efficiency (including vehicle fuel efficiency) and RE must be prioritized
  • A 3-year pilot national emissions trading scheme has been launched in 2020, and will be completed by 2023.
  • Electric vehicle manufacturing: Mexico is one of the main car manufacturing countries in the world. The UK Presidency has made Mexico a member of the COP26 ZEV Transition Council, and the country should disclose plans to shift from ICE to EVs
  • Litigation actions by RE companies and from environmental NGOs against energy policies implemented by SENER, CENACE and CRE have been successful so far in the Courts to defend RE projects and to stop illegal decisions and actions undertaken unilaterally by the federal government. The President has threatened to modify the constitution to benefit state owned energy companies for electricity (CFE) and oil (PEMEX)

Strengths

  • National climate change law reflecting international commitments (with ratchet mechanism). The federal government has not defined a roadmap nor sectoral decarbonisation pathways to comply with the targets embedded in its General Law on Climate Change.The Mexican 2020 NDC update does not contain new or more ambitious targets, but reaffirmed the targets it set 5 years ago.
  • A strong institutional framework to address the need for NDC enhancement and implementation.
  • Some private companies and subnational actors are committed with climate action.

Opportunities

  • Tracking and assessment of NDC implementation by international think-tanks can help make the new government pay attention to climate change, reverse current anti-renewables policies and start advancing implementation of NDC.

Weaknesses

  • Most public resources committed to date favour fossil fuels over RE.
  • A Ministry of Environment and other key environmental agencies that are politically very weak.
  • Additional institutional, technological and political capacity is needed to achieve LDCI+.

Threats

  • Current administration favouring fossil fuels over RE (cancelling 2019 electricity auction aiming to achieve 35% clean energy by 2024 and introducing new rules for clean energy certificates which will seriously undermine this RE incentive).
  • Construction of a controversial new oil refinery in Dos Bocas is underway.
  • Mexico remains dangerous country for environmental activists, due to killings & threats linked to illegal economies.
  • There is no national political will to promote climate change related actions.

About Climate Diplomacy Snapshots

The data is clear. Accelerated and enhanced action is needed now to build resilience and avoid the worst impacts of climate change. As they seek to address the ongoing health, economic and social impacts of COVID-19, governments should seize opportunities to invest in a recovery that will build social, economic and climate resilience on the long-term.The Climate Diplomacy Snapshots aim to provide the climate community with a clear overview of what each country should do, on climate and recovery, to pursue these joint objectives and keep the global average temperature increase to 1.5°C. Each has been prepared with the help of national experts, and will be regularly updated. The snapshots aim to support climate advocacy in the lead up to COP26.

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