Mexican regulator approves new power rates amid public spat

MEXICO CITY, May 29 (Reuters) - Mexico’s energy regulator has approved new rates that electricity providers must pay the national power utility for transmission, it said late on Thursday, as a dispute rumbles on between the private sector and government over industry rule changes.

The regulator, known by its Spanish initials CRE, said the new rates will apply to firms that signed contracts with the utility, the Comision Federal de Electricidad (CFE), before a constitutional reform of the energy sector in 2013-14.

The CRE did not give details of the new charges.

In the reform, renewable firms awarded the right to generate power in auctions under the last government delivered power directly to the CFE without paying transmission costs.

The new transmission rates were approved following a request made by the CFE in March 2019, the CRE said in a statement.

“The carriage charges did not reflect fair and proportional costs for providing the service,” the CRE said. The result had been to create competitive conditions within the electricity market that were “inequitable,” the regulator added.

Mexican President Andres Manuel Lopez Obrador is seeking to strengthen the role of the state in the energy sector and rework contracts with the CFE, arguing that past governments had handed too much control of it to private interests.

His actions have upset some of Mexico’s principal foreign allies and powerful business associations, which have complained the administration is undermining investor confidence by not respecting the terms of existing agreements. (Reporting by Adriana Barrera; Editing by Richard Chang)