The Strategist

Iberdrola stops $1.2B investment project in Mexico


06/25/2020 - 07:15



The Spanish corporation Iberdrola, which is one of the world's largest renewable energy operators, halted the project for a combined cycle power plant in the state of Veracruz after failing negotiations with the Federal Electricity Commission of Mexico (CFE).



Zarateman
Zarateman
"For more than a year the company was engaged in logistics, buying land and licenses, moving staff, spending $ 40 million, but could not reach an agreement (with CFE) before the deadlines expired," said the mayor of the city of Tuxpan, where the construction of the power plant was planned.

An enterprise with 2 thousand jobs worth about 1.2 billion US dollars was supposed to produce more than 1.3 megawatts of electricity, but the company failed to agree on a key point of project viability, connecting to the South Texas-Tuxpan gas pipeline, without which it would lose economic viability.

Governor of Veracruz State Quitlauac Garcia said Mexico’s head of energy, Rocio Nahle, intends to continue the CFE project’s power plant project, which will hold a tender for this work among local companies.

Iberdrola’s Mexican division occupies 15% of the electricity generation market, generating more than 9.1 megawatts of energy in 22 plants in 13 states, including solar and wind parks, and combined cycle plants.

The company has repeatedly become the object of attention of the current president of Mexico, who pointed to its possible corruption with the previous administration. The country's largest private electricity producer, Iberdrola, previously announced continued investment in Mexico, despite a revision of government contracts with private energy companies led by the new government.

source: bloomberg.com




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