LatinAmericaEnergyOutlookOverview:MexicoWorldEnergyOutlookSpecialReportINTERNATIONALENERGYAGENCYTheIEAexaminestheIEAmemberIEAassociationfullspectrumcountries:countries:ofenergyissuesincludingoil,gasAustraliaArgentinaandcoalsupplyandAustriaBrazildemand,renewableBelgiumChinaenergytechnologies,CanadaEgyptelectricitymarkets,CzechRepublicIndiaenergyefficiency,DenmarkIndonesiaaccesstoenergy,EstoniaKenyademandsideFinlandMoroccomanagementandFranceSenegalmuchmore.ThroughGermanySingaporeitswork,theIEAGreeceSouthAfricaadvocatespoliciesHungaryThailandthatwillenhancetheIrelandUkrainereliability,affordabilityItalyandsustainabilityofJapanenergyinitsKorea31membercountries,Lithuania13associationLuxembourgcountriesandMexicobeyond.NetherlandsNewZealandThispublicationandanyNorwaymapincludedhereinarePolandwithoutprejudicetothePortugalstatusoforsovereigntyoverSlovakRepublicanyterritory,totheSpaindelimitationofinternationalSwedenfrontiersandboundariesSwitzerlandandtothenameofanyRepublicofTürkiyeterritory,cityorarea.UnitedKingdomUnitedStatesTheEuropeanCommissionalsoparticipatesintheworkoftheIEASource:IEA.InternationalEnergyAgencyWebsite:www.iea.orgMexico2nd2nd11thlargesteconomyinLatinlargeststeelproducerinLatinlargestoilproducerintheworldAmericaandtheCaribbeanAmericaandtheCaribbeanPopulationMillionpeopleGDPBillionUSD(2022,PPP)GDPpercapitaUSDpercapita(2022,PPP)2423Rural172556002120022800251003790089106114129Urban240030003400201020222030205020102022203020502010202220302050CO2emissionsMtCO2CO2emissionspercapitatCO2/capitaEnergyintensityGJperthousandUSD(2022,PPP)4694794884485213.12562.74.12.42.43.73.63.33.61.71.7EJ1.3STEPS201020222030APS205020102022203020502010202220302050Primaryenergysupplyandshareoflow-emissionssourcesAPSSTEPS100%10550%2010205020102050Shareoflow-emissions(rightaxis)CoalOilNaturalgasNuclearBioenergyHydroWindandsolarOtherTradeofmainenergyproducts(2021)PJTradeofnon-energyproducts(2021)BillionUSD10193ExportsMachineryandElectricityImports6transportequipment122CoalElectronics5819116PartsandGascomponentsfor341695electronicgoods792735Manufactured76Oilgoods982014Table1⊳RecentpolicydevelopmentsinMexicoEconomy-widePolicyPublicationmeasuresyearAFOLU•NDC:ConditionaltargetofGHGemissionsreductionof40%from2022Criticalbusiness-as-usualby2030.2012mineralsOilandgas•CarbonTax:SpecialTaxLawonProductionandServiceswasamendedtoproductionlevyataxonthecarboncontentoffuelsfrom2014.Thecarbontaxisupdatedannually.Sofar,naturalgasisexcluded.PowerIndustry•NationalstrategyforREDD+2017-2030:Goalofnetzerodeforestation2017Transportby2030.Buildings•Adecreegrantedthefederalgovernmenttherightstoexplore,exploit2022andexportlithiumthroughthestate-ownedcompanyLitioMx.•GlobalMethanePledge:Mexicojoinedtheinitiativetoreduceglobal2021anthropogenicmethaneemissionsby30%from2020levelsby2030.2018•GeneralAdministrativeProvisionsonmethanefromthehydrocarbonsector:Regulatedentitiesmustsubmitplanstopreventmethaneemissions,includingactionsandtargets.•LeydeTransiciónEnergética:Setsatargetforcleanenergytohavea201535%shareinelectricitygenerationby2024.•ProvisionsofLeydeTransiciónEnergéticadefinetheprocedurefor2017voluntaryagreementsonenergyefficiencyforlargeindustrialconsumers.•Energyefficiencyoflight-dutyvehicles:Mexicopublishedthestandard2023projectPROY-NOM-163-SEMARNAT-SCFI-2023toupdatetheexisting2023fuelefficiencystandardfornewlight-dutyvehiclesfrom2025.•DraftNationalStrategyforElectricMobility:Setstargetsfor100%ofpassengervehiclesalestobeelectricorplug-inhybridby2040and100%tobeelectricby2050.•Energyefficiencyrequirementsforhomeappliances:NOM-028-ENER-20182017forlightbulbs,NOM-015-ENER-2018forhouseholdrefrigeratorsandfreezers,NOM-023-ENER-2018forairconditioners.Table2⊳MajorinfrastructureprojectsinMexicoHydrogen/ProjectSizeDateonlineStatusDescriptionammoniaMexicanGreen10ktH2/year2025DedicatedsolarPVHydrogenHub,phase1Oilandgas(capacity)2024DedicatedsolarPVEnergíaLosCabos4ktH2/year(capacity)2026DedicatedsolarPVDeliciasSolar6ktH2/year2024(capacity)2023BuildliquefactioncapacityEnergíaCostaAzultoexportLNGLiquefactionplant3Mt/yearOlmecarefineryIncreasenationalrefining340000b/dIEA.CCBY4.0.MexicoenergyprofileFigure1⊳FinalenergyconsumptionbyscenarioinMexico96STEPSAPS3EJLever2010Avoideddemand2022ElectrificationActivityEnergyefficiencyTransportFuelswitchingIndustrySectorBuildingsOther2050Transport2022BuildingsActivityIndustryTransportIndustryBuildings2050IEA.CCBY4.0.Today,transportaccountsforaround40%oftotalfinalenergyconsumptioninMexico.Totalfinalenergyconsumptionincreasesnearly40%intheSTEPSby2050.Acceleratedenergyefficiencygainsandelectrificationreducethisto6%intheAPS.Figure2⊳FuelconsumptioninindustrybytypeandscenarioinMexicoEnergy-intensiveindustriesOtherindustryActivitydrivers1.2250EJIndex(2022=100)0.82000.415020101002050202220302030Chemicals2050CrudesteelLAC2030IndustryVA2050IEA.CCBY4.0.201020222030205020302050STEPSAPSSTEPSAPSCoalOilNaturalgasBioenergyElectricityOtherIEA.CCBY4.0.Withstrongcementandsteelindustries,Mexicoaccountsfor20%ofindustrialenergyuseintheregion,andforaquarteroftheincreaseindemandby2050intheSTEPS.InboththeSTEPSandAPS,theshareoffossilfuelsinenergyconsumptioninindustryinMexicoremainshigh.IntheAPS,theshareofbioenergyremainslowcomparedtootherLACcountries.InternationalEnergyAgencyLatinAmericaEnergyOutlookFigure3⊳FuelconsumptionintransportbytypeandscenarioinMexico3RoadNon-roadActivitydrivers250EJIndex(2022=100)2200115020101002050202220302030205020302050201020222030205020302050STEPSAPSSTEPSAPSOilNaturalgasBioenergyElectricityOtherPassengercarsTrucksLACIEA.CCBY4.0.Electrificationincreasesinroadtransportafter2030inbothscenarios.IntheAPS,electricityaccountsforoverhalfofenergyconsumptionintransportby2050.AdropinoildemandintheAPSismainlydrivenbyashifttoelectromobilityandbyefficiencygainsfrommorestringentfueleconomystandards.Figure4⊳FuelconsumptioninbuildingsbytypeandscenarioinMexicoHeatingandSpacecoolingandActivitydrivers7001.00cookingappliancesIndex(2022=100)EJ0.755500.504000.2525020101002050202220302030205020302050201020222030205020302050STEPSAPSSTEPSAPSAirconditionerstockFloorspaceLACOilNaturalgasBioenergyElectricityOtherIEA.CCBY4.0.IEA.CCBY4.0.Oil-derivedfuelconsumptionslowlydecreasesinbuildingsastheuseofelectricityandnaturalgasincreases.Electrificationhelpsreducethetraditionaluseofbiomass.Ownershipofairconditionersmorethantriplesby2050,andisresponsibleformorethan40%oftheincreaseinelectricityconsumptioninMexico’sbuildingssectorintheSTEPS.Energy-efficientapplianceslimitthesizeoftheincreaseintheAPS.MexicoenergyprofileFigure5⊳AverageelectricitydailyloadprofilebyscenarioinMexico1252022STEPS2050APS2050100GW7550250h24h0h24h0h24hIndustryBuildingsTransportIEA.CCBY4.0.Inbothscenarios,electricityconsumptioninbuildingsalmostdoublesfromcurrentlevels.Itcontributestoatotalpeakdemandincreaseof40%intheAPSby2050.ThegapbetweenpeakdemandintheSTEPSandAPSreflectshigheruptakeofEVswhichaccountfornearly45%ofdailypeakintheAPS.Smartchargingcouldsmooththepeaks.Figure6⊳Electricitygenerationandcapacitybyfuelandscenario1000inMexicoSTEPSAPSSTEPSAPSTWh5002050750GW375500202225020302502050125203020102050205020222022CoalOilNaturalgasBioenergyNuclearHydroWindSolarPVBatteryOtherDedicatedrenewablesforhydrogenIEA.CCBY4.0.IEA.CCBY4.0.NaturalgasdominatesthepowermixinMexicotoday.IntheSTEPS,naturalgasandsolarPVtogethermeetover95%ofelectricitygenerationgrowthto2050.TheAPSseesmuchhigherelectricitydemandby2050thantheSTEPS,withsolarPVandwindmeetingalmostalltheadditionaldemand.InternationalEnergyAgencyLatinAmericaEnergyOutlookFigure7⊳FueldemandandproductionbyscenarioinMexicoOil(mb/d)Naturalgas(bcm)Low-emissionshydrogen(Mt)2.01202.01.5901.51.0601.00.5300.5202220302050203020502022203020502030205020222030205020302050STEPSAPSSTEPSAPSSTEPSAPSProductionDemandIEA.CCBY4.0.IntheSTEPS,naturalgasproductionincreasesnearly25%by2050,butthegapwithdemandwidens;oilproductionfalls,thenplateausasdemandremainssteady.IntheAPS,naturalgasdemanddropssharplyafter2030asuseinthepowersectordeclines;oilproductionfollowsdemanddownwardsandfallsby60%.Figure8⊳AnnualinvestmentinenergysupplybytypeandscenarioinMexico20302022CleanenergyHydro2050STEPSNon-hydrorenewablesAPSNuclearBatterystorageSTEPSElectricitygridsAPSCleanfuelsOtherlow-emissionsUnabatedfossilfuelsOilCoalNaturalgasOtherfossilfuels510152025BillionUSD(2022,MER)IEA.CCBY4.0.IEA.CCBY4.0.Investmentincleanenergysupplyaccountsfor0.5%ofGDPinMexicointheSTEPSin2050and0.9%intheAPS.IntheSTEPS,mostinvestmentisstilldirectedtofossilfuelsin2050.IntheAPS,investmentincleanenergyis3-timeshigherthaninvestmentinfossilfuelsby2050.MexicoenergyprofileNoteshahectaresUnitskmkilometreAreaDistanceGtCO2gigatonnesofcarbondioxideEmissionsMtCO2milliontonnesofcarbondioxideMtCO2-eqmilliontonnesofcarbon-dioxideequivalent(using100‐EnergyyearglobalwarmingpotentialsfordifferentgreenhousetCO2-eqgases)Gastonnesofcarbon-dioxideequivalentEJMassPJexajoule(1joulex1018)MonetaryTWhpetajoule(1joulex1015)OilTcalterawatt-hourPowerteracalorie(1caloriex1012)bcmbcm/dbillioncubicmetresmcm/dbillioncubicmetresperdaymillioncubicmetresperdaykgktkilogrammekilotonnes(1tonne=1000kg)USDmillionUSDbillion1USdollarx1061USdollarx109mb/db/dmillionbarrelsperdaybarrelsperdayGWMWgigawattkVmegawattkilovoltIEA.CCBY4.0.TermsActivitydriversforindustryincludeproductionlevels(Mt)andvalueadded(USD2022,PPP);fortransport,vehicle-kilometres(km)forpassengercarsandtonne-kmfortrucks;forbuildings,airconditioning(millionunits)andfloorspace(millionsquaremetres).TheactivitynumberspresentedcorrespondtotheStatedPoliciesScenario(STEPS)indexedonthe2022value.Bioenergyreferstobioenergyandwaste.Cleanfuelsreferstobiofuels,hydrogenandhydrogen-relatedfuels.InternationalEnergyAgencyLatinAmericaEnergyOutlookIEA.CCBY4.0.Dailyaverageelectricityloadprofilesdonotfactorinelectricitydemandgeneratedbydedicatedrenewablesourcesconnectedtoelectrolysers,andtheyalsodonotconsidertheinfluenceofdemand-responsemechanisms.Energy-intensiveindustriesincludechemicals,ironandsteel,non-metallicminerals(cementandother),non-ferrousmetals(aluminiumandother)andpulp,paperandprinting.Heatingandcookinginbuildingsreferstoenergydemandforspaceandwaterheating,andcooking.Hydrogendemandexcludesbothhydrogenexportsandthehydrogenusedforproducinghydrogen-basedfuelswhichareexported.Investmentdataarepresentedinrealtermsinyear-2022USdollars.Large-scaleCCUSprojectsreferonlytofacilitieswithaplannedcapturecapacityhigherthan100000tonnesofCO2peryear.Low-emissionshydrogenprojectsconsideredarethosewithanannouncedcapacityfor2030.Non-roadtransportincludesrail,domesticnavigation,domesticaviation,pipelineandothernon-specifiedtransport.Otherforpowergenerationandcapacityreferstogeothermal,concentratedsolarpower,marine,non-renewablewasteandothernon-specifiedsources.Otherforfinalconsumptioninsectorsreferstonon-renewablewaste,hydrogen,solarthermalandgeothermal.Otherinasectorcategoryreferstoagricultureandothernon-energyuses.Otherfossilfuelsinenergysupplyinvestmentrefertonon-renewablewasteandothersupplysources.Otherfuelshiftsincludebioenergy,nuclear,solarthermal,geothermalandnaturalgas.Otherindustryreferstotheconstruction,foodandtobacco,machinery,miningandquarrying,textileandleather,transportequipment,woodindustrybranchesandremainingindustry.Otherlow-emissionsinenergysupplyinvestmentincludeheatpumps,CCUS,electricitygenerationfromhydrogen,electricitygenerationfromammoniaanddirectaircapture.Roadtransportincludessixvehiclecategories(passengercars,buses,two/three-wheelers,light-dutyvansandtrucks,andmediumandheavytrucks).SDG7referstoSustainableDevelopmentGoal(SDG)7:“ensureaccesstoaffordable,reliable,sustainableandmodernenergyforall”,adoptedbytheUnitedNationsin2015.Solarpotentialdataiscalculatedbasedontheaveragepotentialatnationallevelassessedinkilowatt-hourperkilowattpeakperday(2020).MexicoenergyprofileTotalfinalconsumptionincludesconsumptionbythevariousend‐usesectors(industry,transport,buildings,agriculture,andothernon‐energyuse).Itexcludesinternationalmarineandaviationbunkers,exceptatworldlevelwhereitisincludedinthetransportsector.AcronymsScenarios:STEPS=StatedPoliciesScenario;APS=AnnouncedPledgesScenario.AFOLUagriculture,forestryandotherlanduseBECCSbioenergywithcarboncaptureandstorageCCUScarboncapture,utilisationandstorageCNGcompressednaturalgasEVelectricvehicleGDPgrossdomesticproductGHGgreenhousegasesH2hydrogenHVDChighvoltagedirectcurrentICEinternalcombustionengineMEPSminimumenergyperformancestandardsMERmarketexchangerateNDCNationallyDeterminedContributionPPPpurchasingpowerparityPVphotovoltaicsSDGSustainableDevelopmentGoalsVAvalueaddedZEVzeroemissionsvehicleThepolicytablesincludeexistingpoliciesandannouncementsasoftheendofSeptember2023.Thesameappliestothetablesofexistingandannouncedprojects.TheIEAdoesnotusecolourstorefertothevarioushydrogenproductionroutes.However,whenreferringtospecificpolicyannouncements,programmes,regulationsandprojectswhereanauthorityusescolourtodefineahydrogenproductionroute,e.g.greenhydrogen,weusethatterminologytoreportdevelopmentsinthisreview.IEA.CCBY4.0.InternationalEnergyAgencyLatinAmericaEnergyOutlookInternationalEnergyAgency(IEA)ThisworkreflectstheviewsoftheIEASecretariatbutdoesnotnecessarilyreflectthoseoftheIEA’sindividualmembercountriesorofanyparticularfunderorcollaborator.Theworkdoesnotconstituteprofessionaladviceonanyspecificissueorsituation.TheIEAmakesnorepresentationorwarranty,expressorimplied,inrespectofthework’scontents(includingitscompletenessoraccuracy)andshallnotberesponsibleforanyuseof,orrelianceon,thework.SubjecttotheIEA’sNoticeforCC-licencedContent,thisworkislicencedunderaCreativeCommonsAttribution4.0InternationalLicence.Thisdocumentandanymapincludedhereinarewithoutprejudicetothestatusoforsovereigntyoveranyterritory,tothedelimitationofinternationalfrontiersandboundariesandtothenameofanyterritory,cityorarea.Unlessotherwiseindicated,allmaterialpresentedinfiguresandtablesisderivedfromIEAdataandanalysis.IEAPublicationsInternationalEnergyAgencyWebsite:www.iea.orgContactinformation:www.iea.org/contactTypesetinFrancebyIEA-November2023Coverdesign:IEAPhotocredits:©GettyImages