MEXICO CITY (Reuters) - U.S.-based power company AES Corp plans to invest at least $1 billion to double its existing electricity generation capacity in Mexico, and also intends to enter the country’s new wholesale power market.
Juan Ignacio Rubiolo, head of AES’s Mexican unit, said in an interview on the sidelines of a trade mission this week that the company expects to benefit from sweeping energy reform and grow beyond its three existing power plants, which generate a combined 1,050 megawatts.
“We have a target of doubling the capacity we have in Mexico,” said Rubiolo, noting that the company’s focus is on plants powered by natural gas.
He said the company expects to invest at least $1 billion over the next three to five years to achieve the target.
AES (AES.N) is active in power generation and distribution in 20 countries and had revenue of $15.9 billion last year.
Rubiolo, previously AES’s top executive in Panama, said the company is also looking to enter a newly created wholesale power market in Mexico.
“That’s one of the major changes of the reform,” said Rubiolo. “It’s definitely one of our main targets.”
The country’s Congress is putting the finishing touches on an energy overhaul that ends the wholesale monopoly held for decades by national power company CFE [COMFEL.UL].
Final approval of so-called secondary laws that are needed to flesh out the fine print of last year’s energy reform is expected in August.
Rubiolo said the company is closely following the creation of a new independent system operator and that body’s independence from the CFE, as well as access to technical data and transparency rules.
He emphasized that the post-reform pace of growth in new power generation will depend largely on access to natural gas.
“We would like to be more comfortable with how they’re going to allow private investors to get access to gas and pipeline capacity,” he said.
Reporting by David Alire Garcia