Speaker 1: Hi, everyone. About a decade ago, I was talking to
Speaker 1: a friend of mine who is a renewable energy developer.
Speaker 1: He'd done projects all over the world, from Southeast Asia
Speaker 1: to Central Europe to subterin Africa. I asked him what
Speaker 1: was next, and he said, well, we're going all in
Speaker 1: on Mexico. Come again, I said, Mexico is dominated by
Speaker 1: c FEE, the state utility. Well, yeah, he said, but
Speaker 1: it's opening up. They're putting in a big renewable energy target,
Speaker 1: a bunch of new reforms, and it's opening up to
Speaker 1: private development. We're going and they did, and so did
Speaker 1: many others. In fact, Mexico became one of the hottest
Speaker 1: markets for clean energy development. Newly opened Mexico attracted billions
Speaker 1: in investment, driven by three highly successful auctions that are
Speaker 1: tied to more than eight gigawatts of new wind and
Speaker 1: solar capacity. But policy under President Andreas Manuel Lopez o Berdor,
Speaker 1: or AMLO as he's known, has taken a u turn.
Speaker 1: Since taking office in late twenty eighteen, AMLO has canceled
Speaker 1: Mexico's renewable energy auctions and sideline national clean energy targets,
Speaker 1: and recent regulation goes further, asserting that renewables threatened Mexico's
Speaker 1: power grid, placing at risk o for four point five gigawats,
Speaker 1: wind and solar currently under development. To tell us more,
Speaker 1: we've got James Ellis, head of Latin America for BENF
Speaker 1: and based in Sampolo and joining us from Mexico City.
Speaker 1: We've got BENF Medals analysts Sharon Mostrie. You can hear
Speaker 1: Sharon talk medals with us in a recent episode on
Speaker 1: unconventional lithium, but today she'll give us a perspectives on
Speaker 1: the energy sector in Mexico. Our discussion is based on
Speaker 1: report titled No Winners in Amulos Clean Energy Feud. BENOF
Speaker 1: users can get this report on banf dot com, the
Speaker 1: benof mobile app, and the Bloomberg terminal. As a reminder,
Speaker 1: BENIF does not provide investment or strategy advice, and you
Speaker 1: can hear the full dist claimer at the end of
Speaker 1: the show. I'm Mark Taylor and you're listening to Switch
Speaker 1: on the BENF podcast. James, Sharon, Welcome, Mark, Hi Mike,
Speaker 1: thank you for inviting us, Thanks for coming in. James
Speaker 1: is going to point the first question to you. We're
Speaker 1: going to talk today about the president of Mexico and
Speaker 1: some things that are going on with his office. Can
Speaker 1: you describe for us who he is and and kind
Speaker 1: of what he stands for. So, Mexico's president is currently
Speaker 1: Andres Manuel Lopez, known pretty widely as MLO. I think
Speaker 1: he has a very interesting political identity. He's been a
Speaker 1: fixture in Mexico's political scene for quite some time, previously
Speaker 1: been mayor of Mexico City. He came to the presidency
Speaker 1: in a landslide election and took office in December of
Speaker 1: that year, and has since done a number of things.
Speaker 1: He has very very strong supporters and very strong detractors.
Speaker 1: And among the interesting things he's done and controversial things,
Speaker 1: I should also add, are many have to do with
Speaker 1: the energy sector. Sharon, was he mayor when you were
Speaker 1: growing up in Mexico City? Yeah, he was mayor when
Speaker 1: I was little. Still remember a lot of of the
Speaker 1: things he did for the city. He has also run
Speaker 1: for president. This would have been his third time when
Speaker 1: he won, so he was always a very like prominent
Speaker 1: controversial figure and I remember being little when he ran
Speaker 1: the first time. It's worth adding as well that he
Speaker 1: started a new party called Morena not that long ago
Speaker 1: and Morena also had a very large showing in congressional
Speaker 1: elections and currently has a majority in the Senate the
Speaker 1: Chamber of Deputies. Is there there's kind of an analog
Speaker 1: anywhere else, like the U s is is eqilualent to
Speaker 1: like a Tea party or a Trump movement or something
Speaker 1: like that. I don't know if there's a US equivalent.
Speaker 1: He reminds me of Trump in some in some sense,
Speaker 1: like his way of doing politics is very focused on himself,
Speaker 1: like it's it's not necessarily done in an ego less way,
Speaker 1: if that makes sense. I think it's pretty remarkable what
Speaker 1: he achieved. What what James was just saying, he he
Speaker 1: basically formed this party or or brought it to the
Speaker 1: center of Mexican politics in a couple of years out
Speaker 1: of basically nowhere. He got a huge control over Mexican
Speaker 1: politics all around. Can we give some context or a
Speaker 1: backdrop to the whole situation, Sharon, Can you explain to
Speaker 1: us kind of what's going on with the with COVID
Speaker 1: nineteen in Mexico and how that relates to actually the
Speaker 1: energy sector. Mexico still hasn't been able to curb the pandemic.
Speaker 1: We we still have kind of record increases in cases
Speaker 1: each day. The government unfortunately didn't take it very seriously
Speaker 1: in the beginning and made it similar to the US
Speaker 1: kind of a political thing rather than just a health crisis.
Speaker 1: The impact on the energy side is obviously a lot
Speaker 1: of things had to close down, so demand decreased, and
Speaker 1: that was then used as well, what spain for changing
Speaker 1: energy policies. So decrease in demand because people are kind
Speaker 1: of staying home and businesses are shut down has been
Speaker 1: used as a tool to explain away or explain some
Speaker 1: changes that the government was to make. Is that fair? Yeah? So,
Speaker 1: given this, what has Amilo's response been as it relates
Speaker 1: to energy. What's really interesting is that MLO has used
Speaker 1: the COVID nineteen pandemic to push through some regulation that
Speaker 1: gets at some of his objectives that he was already
Speaker 1: trying to achieve before the COVID nineteen pandemic, ever, happened.
Speaker 1: At the end of April, Mexico's market operator Sanata issued
Speaker 1: a resolution that indefinitely suspended tests for all renewable plants
Speaker 1: across the country, and that was pretty interesting because it
Speaker 1: basically effectively barred any new projects, any new intermittent projects,
Speaker 1: which means wind and solar in Mexico's case, from connecting
Speaker 1: to the grid at all. Its specifically said intermittent projects.
Speaker 1: That's correct. Yeah, it denied authorization for future tests, and
Speaker 1: it also subordinated dispatch of existing wind and solar plants
Speaker 1: to cefe's firm capacity over the course of the crisis.
Speaker 1: Kind of question. So we'll get into this. But CFE,
Speaker 1: the Mexican State on Utility, owns a considerable amount of geothermal?
Speaker 1: Did it mention intermittent because CFE owns geothermal resources, so
Speaker 1: it's redowables without geo. I think it's entirely possible. I
Speaker 1: mean CFE, what they don't have is wind and solar.
Speaker 1: And what I think all observers of the situation you
Speaker 1: can agree on is that AMLO very much wants to
Speaker 1: limit private participation in Mexico's energy sector. Period they only
Speaker 1: have two percent of Mexico's total wind and solar capacity.
Speaker 1: See if he only has about two percent of that
Speaker 1: very little, So this has basically been interpreted as efforts
Speaker 1: to achieve that objective by using the pandemic Sharon, why
Speaker 1: is energy so political? In Mexico? Energy has a history
Speaker 1: of being a very important political topic in Mexico since
Speaker 1: like after the Mexican Revolution, so like the nine thirties,
Speaker 1: and for a while the oil and gas and the
Speaker 1: electricity sector were nationalized, and until recently with the presidency
Speaker 1: before Amino, they were private tizes. So MN did not
Speaker 1: want to kind of go back on those reforms explicitly,
Speaker 1: but has been undermining them with the kinds of things
Speaker 1: that Jamsilo is just mentioning for the layer and making
Speaker 1: it really hard for private companies to participate in the
Speaker 1: energy space. But it's so political because there are just
Speaker 1: people in the government who want energy to remain controlled
Speaker 1: by a government. I don't understand why. I think it's
Speaker 1: it's in a pretty old ideology where where basically Mexico
Speaker 1: perceives private companies as coming into the country to extract
Speaker 1: kind of value and resources without giving anything back, and
Speaker 1: specifically with energy, it's thought of as a strategic thing
Speaker 1: that the government should control. What James was mentioning is
Speaker 1: basically what I'm always trying to achieve is to conserve
Speaker 1: the main power within the energy sector in Mexico in
Speaker 1: the hands of public companies. A lot of detractors of
Speaker 1: what I'm low is doing. Will argue that it's actually
Speaker 1: employed to continue with a government who has kept public
Speaker 1: companies running while taking advantage of them as public officers.
Speaker 1: And and there's a lot of corruption going on in
Speaker 1: both CFE and BMICS, So it's a complicated issue where
Speaker 1: officials kind of argue that nationalization is is for the
Speaker 1: security of the country and the benefit of the people.
Speaker 1: So it's kind of a populist tactic, but the detractors
Speaker 1: will say, no, it's just kind of a way to
Speaker 1: get money and to further corruption. I think that as
Speaker 1: as Sharon explained, I mean, energy is a is a
Speaker 1: controversial topic. The energy, the market opening reforms of the
Speaker 1: Penya and Yeto government, the one that preceded AMBLO. It
Speaker 1: involved passing constitutional amendments. It's an inherently controversial issue. I think.
Speaker 1: In Mexico, what we've seen recently and why that's interesting
Speaker 1: is using the low demands scenario that's kind of resulting
Speaker 1: from the pandemic to guarantee the state's share or to
Speaker 1: guarantee that state that that may be you know, the
Speaker 1: slightly older or or inefficient, more fossil fuel based fleet
Speaker 1: of the CFE, to guarantee that those plants continue to
Speaker 1: run instead of instead of intermittent plants is really what's interesting.
Speaker 1: And as I mentioned, those intermittent plants are very much
Speaker 1: the product of private investment that the energy reforms ushered in.
Speaker 1: So they're saying that on current projections of low demand scenario,
Speaker 1: they don't need more power and so they're cutting off
Speaker 1: the top. Well, that's I would say, what it looks
Speaker 1: like the uh SO, both the Senase resolution and then
Speaker 1: there was also the Ministry of Energy published a policy
Speaker 1: in the in the official federal gazette that sort of
Speaker 1: tried to make these changes permanent. They both spoke to
Speaker 1: the same thing, which is safeguarding the reliability of Mexico's
Speaker 1: power system. That that that's what it was really about nominally,
Speaker 1: But what it is really about, I think is is
Speaker 1: and and it's quite quite clear to everyone. It's really
Speaker 1: about a Sharon laid out there. It's about safeguarding the
Speaker 1: role of the public sector and strategic industries. Just to
Speaker 1: add to that, it's important to point out that most
Speaker 1: of the generation that the CFE owns is fossil fuel,
Speaker 1: so usually they they kind of marginal, and especially the
Speaker 1: oil field plans they would run now in the summer
Speaker 1: where COVID has had the most impact. So part of
Speaker 1: what they're doing is it's very connected to PEMICS and
Speaker 1: the fact that i AM reduce the demand for the
Speaker 1: oil that pemics produced. But this oil can be used
Speaker 1: in the generators of the CF so it's kind of
Speaker 1: to put to use that excess oil that be MIX has.
Speaker 1: There's this kind of new organization of how you can
Speaker 1: deploy energy assets within the market in Mexico and giving
Speaker 1: priority to fossil fuel generators so that they could use
Speaker 1: this excess oil is also part of this story. So
Speaker 1: just to clarify for those it might not be familiar, pemmics,
Speaker 1: I guess the is the National Oil Company of Mexico.
Speaker 1: Is that right? And i AM is the International Maritime
Speaker 1: Organization Organization. Yeah, which basically it reduced the amount of
Speaker 1: sulfur you can have an oil used in shipping, and
Speaker 1: that tends to be the oil that BEMIS produces. So
Speaker 1: now they have reduced demand for oil, so there's a
Speaker 1: reduced demand for this and now they can say, okay,
Speaker 1: we can just burn this for power generation in Mexico.
Speaker 1: So James, you said to see if he only owns
Speaker 1: two to three percent of the intermittent capacity or wind
Speaker 1: and solar capacity in Mexico, what companies when they opened
Speaker 1: up the barn doors, as it were, to open up
Speaker 1: the end of energy industry in Mexico, what companies came
Speaker 1: in who participated in the auctions. So the largest owners
Speaker 1: currently of wind and solar capacity in Mexico are our
Speaker 1: European developers. We're talking about a nell I, guerdroa Axon,
Speaker 1: a UK based investor Actors owns a number of developer
Speaker 1: platforms as well, and so on. But in general, the
Speaker 1: auctions that Mexico held over seventeen there were three of them.
Speaker 1: They were highly successful, transparent and competitive internationally. They were
Speaker 1: considered to be successes, and they really attracted a wide
Speaker 1: variety of players. As you said, just a few years ago,
Speaker 1: Mexico was very much top of mind if you were
Speaker 1: thinking about exciting new markets for development of clean energy.
Speaker 1: And why this story is so interesting is that it
Speaker 1: has been a complete one eight From a policy point
Speaker 1: of view, and as you said before, you think this
Speaker 1: is a push for supply security or nationalization of the
Speaker 1: energy sector. I think that m low is this government
Speaker 1: is fundamentally opposed to the energy reforms that were passed
Speaker 1: by the last government. They are not in favor of
Speaker 1: private participation in the in the energy sector on either
Speaker 1: the oil and gas side or or the electricity side,
Speaker 1: and they're looking to safeguard what role the state has
Speaker 1: and and then possibly build on that. And you can
Speaker 1: point to many steps that the government took but before
Speaker 1: since Amlo took office that bolster this perspective. Okay, In
Speaker 1: addition to cancel they canceled the renewable energy Auction program,
Speaker 1: which by the way, as I mentioned, were considered to
Speaker 1: be successful and transparent, competitive secured, competitively priced power for
Speaker 1: the cfe's residential supply arm. By the time that the
Speaker 1: prices kind of fell every auction, and by the time
Speaker 1: they got to the third the average average off taker
Speaker 1: price was was under twenty dollars per megal at hour.
Speaker 1: Over the course of the past year and a half,
Speaker 1: the government has also sought to dilute the market for
Speaker 1: renewable energy credits, has basically sideline national clean energy targets
Speaker 1: and then also kind of taken steps to even even
Speaker 1: undercut benefits that legacy wind and solar projects and received,
Speaker 1: which predates energy or form, so there's sort of like
Speaker 1: a long I guess I would say there's a there's
Speaker 1: a pretty long paper trail here of looking to limit
Speaker 1: private participation in the energy sector, and unfortunately that very
Speaker 1: much has brought wind and solar into the crosshairs. Shared
Speaker 1: as a resident of Mexico City, have you noticed any
Speaker 1: changes in in either supply reliability and has there been
Speaker 1: blackouts or has there been any differences to your day
Speaker 1: to day life as electually been more expensive. No, I
Speaker 1: wouldn't say I've noticed any huge differences yet. There haven't
Speaker 1: been any blackouts, and the prices in Mexico are are
Speaker 1: quite subsidized, so I haven't noticed a rise in the
Speaker 1: last few months. I wanted to add to James's comment,
Speaker 1: which is, yeah, the government has been very creative and
Speaker 1: in the way it is trying to consolidate power for
Speaker 1: the CFE and for by mix. But just to like
Speaker 1: put it into perspective of the two sides, one side
Speaker 1: will say that this nationalization of energy is good for
Speaker 1: prices and ultimately saves a taxpayer money even if we
Speaker 1: don't notice it in our bills, because it reduces the
Speaker 1: subsidies that that the government has to give um. The
Speaker 1: other side will say that's that's false, like, actually, these
Speaker 1: intermittent sources are are a lot cheaper to run, and
Speaker 1: it makes no sense to say that prices will be
Speaker 1: higher with renewables versus versus gas or oil plants because
Speaker 1: just their marginal clusts are a lot higher. It's also
Speaker 1: important to say, like some people think this nationalization tactic
Speaker 1: for security reasons is also because a lot of the
Speaker 1: gas that Mexico would use for most of its fossil
Speaker 1: fuel plants within the Cifee is imported. So ultimately we
Speaker 1: still rely on like for foreign resources to power the
Speaker 1: national power company. So really, what what would need to
Speaker 1: happen is if the national company wants to be fully
Speaker 1: sovereign and and independent of you know, US gas imports,
Speaker 1: it would have to invest in renewables itself for or
Speaker 1: generate gas within Mexico, which it seems unlikely. Why hasn't
Speaker 1: see if he invested in renewables. I don't know that
Speaker 1: I could give, you know, not not being party to
Speaker 1: see if he sort of strategic decision making, I don't
Speaker 1: know if I could like fully, you know, give a
Speaker 1: full answer to that But what we can say from
Speaker 1: from from looking at like for example, the Mexican government
Speaker 1: independent audit of CFE a few years ago, and for
Speaker 1: looking looking at its sort of public financial accounts and
Speaker 1: also it's lack of investment in renewable energy and generally
Speaker 1: aging generation portfolio, is that it sort of lacks a
Speaker 1: plan or mandate to to to revamp itself. It is
Speaker 1: sort of a classic on large on competitive public entity
Speaker 1: that nevertheless is the backbone of Mexico's generation capacity. It's
Speaker 1: has a market share by capacity, so the CFE is
Speaker 1: fundamental to to to the sector. But it's also sort
Speaker 1: of a bit, I think a little bit in UM
Speaker 1: caught between two competing visions for for for what Mexico's
Speaker 1: energy sector should be. These these famous energy reforms begun
Speaker 1: in unbundled the utility UM. But as Sharon said, supply
Speaker 1: to two households is one of the areas that remains
Speaker 1: in the that that it kind of retains monopoly of
Speaker 1: over as well as transmission and distribution, and its generation
Speaker 1: segment was broke down into six different, six different entities.
Speaker 1: But ultimately, when it comes to I mean, when it
Speaker 1: comes to costs, Mexicans Mexican citizens do pay lower, low
Speaker 1: by regional standards prices for power and that's due to subsidy. UM.
Speaker 1: In each of the past two years, that's total about
Speaker 1: four billion U S dollars from that's been the transferred
Speaker 1: from the government to CFE. So even if you don't
Speaker 1: feel it in your power bill, then costs are born
Speaker 1: somewhere in the in the sense of higher system costs,
Speaker 1: and then government subsidy, which ultimately flows through the taxes
Speaker 1: I suppose at some point. So it couldn't compromise be
Speaker 1: for both these competing visions. Be Yeah, let these quote
Speaker 1: unquote reforms go through UH and more control goes to CFE,
Speaker 1: but allowed developers to come in and develop wind and
Speaker 1: solar projects. That see if he would then buy right,
Speaker 1: So see if he becomes a competitive utility buying competitive power,
Speaker 1: but it doesn't have to develop the know how or
Speaker 1: the you know, doesn't have to build the projects themselves,
Speaker 1: wouldn't that work? Yeah? I I well, I think one,
Speaker 1: as you said, we don't know, but I think that's
Speaker 1: absolutely a that that that that would be a a
Speaker 1: positive and constructive step. Um, there's no reason why they
Speaker 1: can't tender why they couldn't tend their projects, uh and
Speaker 1: and sort of and and and begin the process of
Speaker 1: revamping their portfolio and its diversifying into into new clean technologies.
Speaker 1: I mean this is common in several other countries that
Speaker 1: have national power companies, where you just tend to the
Speaker 1: project and then buy it once it's build. Yeah, you know,
Speaker 1: Sharon I think brought in a really fundamental theme before
Speaker 1: when when when she was talking about bringing in the
Speaker 1: national company the I m O regulation what to do
Speaker 1: with this excess fuel oil? And that is that um
Speaker 1: AMBLO has this sort of old school view I suppose
Speaker 1: of what it means to be what what what it
Speaker 1: what it means to be sovereign? Maybe, and that is
Speaker 1: based on Mexico should seek to return to it's it's
Speaker 1: it's higher producing days in terms of oil and gas.
Speaker 1: It should refine all it's all of its own crude
Speaker 1: into into refined products, and it should basically you know
Speaker 1: that the should do be able to do everything itself.
Speaker 1: I don't think anybody has ever gotten a sense that
Speaker 1: the at the high highest levels of this government that
Speaker 1: they actually understand the value of renewables. I think they
Speaker 1: actually view renewables as a and by by renewables, I
Speaker 1: mean winded soul, and mostly they view it as an
Speaker 1: expensive alternative possibly also sort of laced with with corruption, corruption,
Speaker 1: and time to the private sector. So there's clearly misunderstanding. Okay,
Speaker 1: so my my quote unquote compromise is not going to work.
Speaker 1: What is actually happening then in Mexico, the latest regulatory
Speaker 1: and policy steps the government has taken are very vulnerable
Speaker 1: to legal challenge, and in fact, since this sort of
Speaker 1: latest attack I guess you could say on renewables has happened,
Speaker 1: there's been three separate in junks at the federal court
Speaker 1: and even the Supreme Court level that have suspended their implementation.
Speaker 1: So what that means is that basically all this um
Speaker 1: kind of like anti renewable policy is sort of on
Speaker 1: hold and pending. It doesn't mean it's completely shot down,
Speaker 1: but the fact that that a lot of what Amilo
Speaker 1: has tried to do in the electricity sector has not
Speaker 1: been successful in moving forward kind of underscores the strength
Speaker 1: with which energy reform was passed. I mean, there are
Speaker 1: conflicts with what he's trying to do, both with the
Speaker 1: constitutional amendments as well as with the implementing legislation. So yeah,
Speaker 1: the regulatory rollback that is currently conceived is faces a
Speaker 1: lot of headwinds going forward, and it's unclear if any
Speaker 1: of this stuff will actually remain standing. To add to that,
Speaker 1: it's actually been quite hardening to see an institutional checks
Speaker 1: and balances play out with this particular issue in Mexico.
Speaker 1: So the two injunctions that James was referring to, one
Speaker 1: reason they were given was they would undermine competition and
Speaker 1: further monopoly, which would be the CFE. And then the
Speaker 1: other reason is actually quite historical. It was given for
Speaker 1: reasons to protect the environment. So the Supreme Court legitimized
Speaker 1: environmental issues as a reason to stop these new regulations
Speaker 1: going forward. If I'm a private company that it looked
Speaker 1: at Mexico ten years ago, I think we might be
Speaker 1: in a situation where it seemed like a good idea
Speaker 1: at the time. Have private company has been kind of
Speaker 1: spooked by what's going on there or are they still
Speaker 1: interested in Mexico as in the market opportunity. You know,
Speaker 1: I think they're still interested in Mexico as a market opportunity.
Speaker 1: But I also think it would be naive to think
Speaker 1: that these latest policies and the overall sort of approach
Speaker 1: of the animal administration to the sector hasn't seriously undermined
Speaker 1: investor confidence. So I think jects that are in the
Speaker 1: queue in the pipeline, that are financed under construction, they
Speaker 1: are by and large moving ahead. I think that if
Speaker 1: you go a step out, it might be the projects
Speaker 1: that are more in conceptual phase. It might be more
Speaker 1: what I guess what I mean is new or potential investment.
Speaker 1: I would expect to take a serious hit from this
Speaker 1: kind of the view from the ground. Since the start
Speaker 1: of Aminos presidency, his speech has has been very clear
Speaker 1: about his lack of support for the private sector, both
Speaker 1: foreign companies and national companies, and that has seriously slowed
Speaker 1: down investment in the country in general. I think the
Speaker 1: energy sector kind of took a while to see this
Speaker 1: get to them. But if it follows the same trajectory
Speaker 1: as other investors and their confidence in Mexico, both national
Speaker 1: investors and foreign investors, but in other sectors, then I
Speaker 1: would expect for there to be a slowdown in the
Speaker 1: energy space as well, just because it's really hard to
Speaker 1: deal with a government that is so inconsistent and and
Speaker 1: that makes it a lot more risky too to invest
Speaker 1: in these huge projects and the presidency in Mexico markets,
Speaker 1: it's it's just worth worth noting as well. UM is
Speaker 1: a single six year term. An MLS is just about
Speaker 1: two years in, so there's you know, there's four more
Speaker 1: years of UH to see where things go. And I
Speaker 1: would imagine you know, a material a material amount of
Speaker 1: investment will be will be delayed or or you know,
Speaker 1: maybe some investors will think twice and hit pause UM
Speaker 1: on on new projects. But we're talking about just to
Speaker 1: put numbers to this, we're talking about there's about almost
Speaker 1: five giga lots of wind and solar that's under development
Speaker 1: currently UM. Then there's about almost eleven gig lots of
Speaker 1: wind and solar that is UH that is commissioned. So
Speaker 1: a lot has has gone into the ground, but there's
Speaker 1: still a lot that's kind of in limbo. Absolutely, And
Speaker 1: part of the reason why a lot has gone into
Speaker 1: the ground is that Mexico has a very strong history
Speaker 1: of renewables UM that that that pre date this UH.
Speaker 1: This discussion by long ways with wind development has been
Speaker 1: particularly strong in Mexico, predating energy reform. In fact, final question,
Speaker 1: is there a winner in all of this. We think
Speaker 1: it's very hard to see a winner in all this
Speaker 1: simply because, as has already been amply demonstrated, the government
Speaker 1: in the private sector are going to lock horns every
Speaker 1: time a new policy or regulation comes out that that
Speaker 1: is that is sort of easily open to legal challenge
Speaker 1: um and, which all of these have been. So what
Speaker 1: we're likely looking at because we do think that it's
Speaker 1: it's quite likely that EMIL will continue to challenge the
Speaker 1: private sector and therefore renewables. We think it's likely that
Speaker 1: we're going to see continuing um and and probably mutually
Speaker 1: damaging legal legal fights. So UM stay tuned. We definitely
Speaker 1: will and we'll definitely have to have you back on
Speaker 1: the show to talk about it. Sharon James, thanks for joining.
Speaker 1: Thank you, thanks so much. Mark. Bloomberguin e F is
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