Budget for the energy transition: has it really fulfilled its resource distribution?
How are we doing in terms of clean fuel usage? While its use has been prioritized worldwide, and Mexico has even made international commitments to reduce greenhouse gas (GHG) emissions, the Center for Economic and Budgetary Research (CIEP) has warned that these emissions have increased by 11.4%.
In the document “Budget 2023-2024: Energy Transition and Climate Change,” produced by the CIEP in collaboration with the Mexican Center for Environmental Law (CEMDA), it was revealed that Mexico's failure to comply with its agreements is directly related to budgetary issues.
According to the report by researchers César Augusto Rivera de Jesús and Alejandra Macías Sánchez, the budget allocated in 2023 and 2024 for reducing greenhouse gas emissions did not allow for “progress toward the decarbonization of the economy,” especially in the electricity sector, where GHG emissions increased by 11.4%.
How much of the budget is allocated to the energy transition?
The document produced by the CIEP indicated that of the 243,705 million pesos (mdp) identified in the annexes of the Transition Strategy to Promote the Use of Cleaner Technologies and Fuels and Resources for Mitigating the Effects of Climate Change, from the 2024 Federal Expenditure Budget (PEF), only 62,241 mdp (25.5%) are allocated for climate-friendly actions.
Although the analysis pointed out that the budget in the cross-cutting annexes includes 155.2% more funding for clean energy, the National Electric System Development Program (PRODESEN) 2024-2028 indicates that “the net installed capacity of combined cycle that would be added would be 358% greater than the installed capacity of clean energy.”
So, what is happening with the resources? The study by the Center for Economic and Budgetary Research and CEMDA indicated that there is “a discrepancy between the resources allocated and their purpose,” as at least 49.2% of the total budget allocated for 2024 has been directed to the Mayan Train, “a project not directly linked to climate change mitigation.”
Moreover, it was emphasized that at least 26 of the 63 programs receiving this portion of the budget are not directly related to energy transition and climate change. There are even projects where there is a duplication of resources, mainly in the Federal Electricity Commission (CFE) and the Ministry of Energy (SENER).
In light of this, the CIEP warned that a rigorous review of the programs and resources included and allocated for each program is needed; otherwise, international agreements will not be fulfilled. Therefore, it suggested establishing energy and environmental policies connected to efficient budget allocation.
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