Mexico’s state power utility Comisión Federal de Electricidad (CFE) has avoided substantial variable generation costs and greenhouse gas emissions by purchasing clean energy through competitive auctions, according to a new study commissioned by the Institute of the Americas think tank.


Former Comisión Reguladora de Energía (CRE) Chairman Francisco Salazar and former CRE Commissioner Francisco Barnes authored the study, which argues that CFE should embrace efficient natural gas and renewables in the power sector over fuel oil, diesel and coal in order to reduce costs for consumers and achieve Mexico’s climate goals.

“CFE must accelerate the modernization of its generation system by installing new combined-cycle power plants, repowering its hydroelectric plants, and...