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
  • Mexico should not promote the use of fossil fuels in power generation. Instead, it should promote again (and not slow down) renewable energies
  • 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
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
  • Incentivize renewable energy investments and the expansion of the grid. 
  • Ensure implementation of REDD+ Strategy at national / subnational levels; including agreements between Ministries of Environment and Agriculture to align programs for sustainable rural development
  • The National Forest Commission (CONAFOR) and 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.
  • Stronger vehicle fuel efficiency standards; support EV and EV infrastructure; improve industry efficiency; and waste management 
  • Increase and expand current carbon tax to all fossil fuels including methane 

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
  • The government budget under discussion for 2021 is decreasing the budget for disaster management, climate change, among others. However the budget for the construction of the new refinery remains intact
  • CAT estimates that Mexico will have to implement additional policies to reach its original NDC targets. The country is at risk to even increase its original emissions baseline scenario
Recovery Measures to Highlight:

  • 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 is preparing a 1.5 aligned climate strategy. The City also has a recovery plan which includes environmental aspects but its not the case at the national level

Recent developments

Recent developments

  • 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 will be launched in 2020
  • 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)
  • A strong institutional framework to address the need for NDC enhancement

Opportunities

  • Tracking and assessment of NDC implementation by international think-tanks (CAT, Climate Transparency (Brown to Green) etc.) can help make the new government pay attention to climate change, reverse current anti-renewables policies and start advancing implementation of NDC (after developing and publishing specific 2030 pathway)

Weaknesses

  • Most public resources committed to date favour fossil fuels over RE
  • Politically very weak Environment Ministry (significant cuts in personnel and budget under new administration)  will make it even more difficult to advance on climate mitigation. Interest & support by the President will be needed
  • 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

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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