Mexico

Country Information

Important Dates

MRP first draft submission: 
October 2012
Allocation of Implementation Funding: 
March 2013

Key Documents & Presentations

Market-based Approach

Fact

  Curt Carnemark / World Bank

Mexico uses a carbon tax on fossil fuels to price CO2  emissions. Photo credit: Kurt Carnemark/World Bank

The PMR will support Mexico to:

  1. Design an MRV framework and an institutional arrangement for three crediting NAMAs: SEMARNAT has been analyzing a MRV system for NAMAs, inventories, LEDS and financial support. The Federal Government of Mexico envisions a MRV system as a framework which ensures that all projects and programs, like those for emissions inventories and reductions, mitigation actions and REDD+, satisfy clear standards. The Inter-ministerial Commission on Climate Change (CICC) has taken the lead in this effort through pioneer activities such as the external evaluation of the PECC.
  2. Develop a NAMA tracking tool to record transactions and emissions reductions—key for the prevention of double counting and to ensure transparent accountability: A registry system and tracking tool in Mexico will provide updated information about the voluntary GHG mitigation projects included or to be included in the different schemes in which Mexico may participate, such as VCS, CAR, CDM, bilateral schemes, NAMA and a new market mechanism under the UNFCCC, etc.

Carbon Pricing Experience

Carbon Tax

In 2014, Mexico introduced a carbon tax applied to the use of fossil fuels. The purpose of the tax is to price Co2 emissions and to promote cleaner fuel use. CDM credits can be used to offset the tax burden. The initial price of the tax is $3.5/tCO2e. Natural gas is exempt from the tax.

Crediting and Offsetting

Mexico envisions new market mechanisms, like crediting NAMAs, that will widen the scale of activities and participants, address entire sectors of the economy and allow the development of a series of co-benefits like the development of required national capacities.

Mexico prioritized three sectors in introduce crediting NAMAs: integrated urban mobility, domestic refrigerators, and urban NAMA. Mexico aims to maximize the potential mitigation through the optimization of existing conventional public transport systems in urban centers of the Urban Transport Transformation Program (UTTP) and the Federal Mass Transit Program (PROTRAM). The domestic refrigeration technology currently sold in Mexico is based on Hydro fluorocarbons refrigerants (HFC), with the predominant use of R134a (1,1,1,2-Tetrafluoroethane). This refrigerant has a significantly high Global Warming Potential (GWP=1300 units) and therefore its phase-out will contribute to climate change mitigation. Mexico envisions that the deployment of sustainable urban communities will help achieve credited GHG emissions reductions.

National Context

Mitigation Target

The Government of Mexico (GoM) acknowledges that climate change constitutes the primary global environmental challenge of this century and represents an opportunity to promote sustainable human development. In response, Mexico is committed to move away from its unsustainable trend of GHG emissions growth. To support this commitment, Mexico published the General Law for Climate Change in 2012.

Mexico commits to reduce up to 30% of its emissions by 2020 compared to its baseline scenario, and 50% of its emissions in 2020 by 2050; dependent on the provision of international support and participation in external markets. In addition, the General Law for Climate Change provides a goal of increasing up to 35% of energy generated from clean sources by 2024.

Sectors in the Mexican economy with high emissions growth by 2020 and 2030 respectively are: transport (39%-63%) power generation (49%-56%), industrial gases (30%-49%) and methane emissions from waste and agriculture (22%-33%).

Achieving the Target

Through the implementation of the first Special Program for Climate Change (PECC) between 2009 and 2012, Mexico committed public investments to implement mitigation actions, combined with complementary resources from CDM, to curb national emissions.

The definition of a new PECC 2013-2018 will enhance the scale of Mexico’s emissions reduction activity, address entire sectors of the economy and allow the development of a series of co-benefits like the development of national capacities and the promotion of large-scale NAMAs. The goal is to curb GHG and CCVC emissions towards the country’s vision for 10, 20, and 40 years as described in the National Strategy for Climate Change published in June 2013.

Regulatory Framework

In 2007, Mexico published its first National Strategy for Climate Change and in 2008, the first Special Climate Change Program 2008-2012 (PECC) aimed to establish goals in mitigation and adaptation.

In June 2012, the General Climate Change Law (LGCC, 2012) was passed by the Mexican Congress. This is the first legislative mandate to transition towards a competitive, sustainable economy with low carbon emissions that generates environmental, social and economic benefits. Some of this infrastructure comprises the Mandatory Emissions Registry that is currently under development and will start operating in 2015; the voluntary carbon exchange platform launched in November 2013 and the National Climate Change Fund.

In January 2013, the Inter-Ministerial Climate Change Commission (CICC) was established to coordinate climate change policies at the federal level. In June 2013, the Government officially launched the National Climate Change Strategy (ENCC), a Mexican planning instrument to tackle climate change with a 10, 20, and 40 years vision; through three adaptation pathways, and five pathways for low emission development, supported by six policy pillars.

In April 2014, Mexico launched the 2013-2018 PECC. This policy planning instrument prioritizes GHG and CCVC mitigation actions to achieve low emission growth, where NAMAs and supporting infrastructure for current and future carbon markets play an important role.

In October 2014, regulation supporting the National Emissions Registry, comprised of data on the GHG emissions generated by stationary and mobile sources, became effective. Reporting establishments are legally required to provide information, data, and documents regarding their direct and indirect emissions. The threshold that will trigger a reporting requirement taking into account direct and indirect emissions, will be based on an annual sum, as long as the result is equal or higher than 25,000 metric tons of CO2e. The following sectors are required to report: i) energy, ii) transportation, iii) industrial, iv) agriculture and farming, v) waste, and vi) commerce and services. 

Focal Point

The PMR focal point is the Ministry of Enviornment and Natural Resources SEMARNAT.

 

All Documents & Presentations

Country Work
Document Language Date
Mexico: Update on MRP Implementation (October 2013) English October 2013
Mexico: Draft Market Readiness Proposal Presentation English October 2012
Mexico: Country Update (March 2012) English March 2012
Mexico: Organizing Framework English May 2011
Mexico: Expression of Interest Letter English February 2011
Mexico: Expression of Interest (EoI) English February 2011
Policy Work
Document Language Date
Mexico: Development on Emissions Trading for Power Sector English May 2014
Mexico: Overview of Carbon Tax English May 2014
Mexico: Integrating Carbon Tax with a Broader Climate Change Policy English May 2014
Mexico: Climate Change Law and Policies English April 2014
Mexico: General Law on Climate Change English October 2013
Mexico: Update on Policies (October 2013) English October 2013
Mexico: National Climate Change Strategy 2013 (Spanish) English June 2013
Technical Work
Document Language Date
Mitigation and Transport Workshop: Mexico Experience with Crediting Mechanisms in Transport English March 2014
Crediting Mechanisms Workshop: Mexico Mitigation from the Housing Sector English October 2011
Crediting Mechanisms Workshop: Mexico Policy Context for Scaling Up Mitigation English October 2011
Crediting Mechanisms Workshop: Mexico Crediting NAMAs English October 2011
Resolutions
Document Language Date
Resolution PA5/2013-4: Allocation of the Implementation Phase Funding to Mexico English March 2013
Resolution ORG-3: Implementing Country Participants' Participation English April 2011
Other Materials
Document Language Date
Mexico: Update on Joint Crediting Mechanism (November 2014) English November 2014
Mexico: Nexus of Energy Policy and Market Instruments (November 2014) English November 2014
Mexico: Towards a Climate Market English October 2014
Mexico: Gestion Climatica - Estrategias Instrumentos de Mitigation English March 2014
Mexico: Desarrollo Urbano, Adaptación y Mitigación English March 2014

Disclaimer: The World Bank does not guarantee the comprehensiveness and accuracy of the data and information included in the Market Readiness Proposal (MRP) and in presentations submitted by PMR participants. Further, the World Bank accepts no responsibility whatsoever for any consequence of their use. The boundaries, colors, denominations, and other information shown on any map in the MRPs or on this website do not imply on the part of the World Bank any judgment on the legal status of any territory or the endorsement or acceptance of such boundaries.