Mexico has made significant strides in developing its renewable energy sector, leveraging its diverse renewable energy resource base, which includes solar, wind, geothermal, and hydropower. The country’s favorable geographical conditions, such as high solar radiation, wind capacity, and geothermal sources, have positioned it as an attractive destination for renewable energy investment. Mexico’s renewable energy potential remains strong, with the government setting a target for 35% of its electricity to be generated from renewable sources by 2024. In 2021, Mexico generated 26.7% of its electricity from renewable sources, indicating substantial progress towards meeting this aim.
The country’s transition towards renewable energy presents a significant opportunity to enhance its energy mix, meet the increasing demand for clean energy sources, and contribute to sustainability, energy security, and affordability. Mexico’s wind and solar energy proportion has tripled since 2015, contributing to almost 10% of its electricity generation in 2022. Despite this growth, the country has not taken significant measures to decarbonize over the past few years, and it has increased fossil fuel usage while reducing private participation in the energy sector. Adapting to global operational practices and modernizing its energy sector are imperative for Mexico to achieve a successful energy transition and catch up with advanced economies.
Mexico’s renewable energy prospects are significant, and the country has the potential to attract large-scale investment in renewables that can help diversify its energy supply and significantly reduce its greenhouse gas emissions. The government’s ambitious targets for renewable energy capacity expansion, coupled with its vast and renewable natural resources, including abundant sunlight for solar power, strong wind resources, untapped hydropower potential, and prevalent geothermal sources, provide numerous opportunities for investors and the development of clean energy generation. Additionally, there are opportunities to invest in energy storage solutions to stabilize renewable energy, as well as new technologies such as green hydrogen and green gas. However, the sector also faces challenges and threats that must be addressed to continue the path to a secure and sustainable energy transition.
