aut-op-sy
mailing list archive
[ Other Periods
| Other mailing lists
| Search
]
Date:
[ Previous
| Next
]
Thread:
[ Previous
| Next
]
Index:
[ Author
| Date
| Thread
]
AUT: [Ciepac-i] English Chiapas al Dia 279 I
- Subject: AUT: [Ciepac-i] English Chiapas al Dia 279 I
- From: CIEPAC <ciepac@xxxxxxxxxxxxxx>
- Date: Wed, 24 Jul 2002 09:33:27 -0500
<html>
<br>
<div align="center"><b>^ÓChiapas Today^Ô Bulletin No. 279<br>
CIEPAC; CHIAPAS, MÉXICO<br>
February 27, 2002<br><br>
Electric Energy: History and Analysis of the Nation^Òs Great Heritage
<br><br>
</b></div>
Mexico^Òs Electric Sector may soon undergo a rapid reform. President
Vicente Fox can present his reform initiative on March 15th, Congress^Ò
first ordinary period of sessions in 2002. The Institutional
Revolutionary Party (PRI), the Ecologist Green Party of México (PVEM),
and the Democratic Revolutionary Party (PRD) have also announced their
own initiatives. Therefore, four proposals will enter into
discussion and the decision may be pushed back until the next period of
sessions in September.<br><br>
The central theme of the debate is to what extent a reform of the sector
signifies privatization of Mexican electric energy, directly or
indirectly, explicitly or veiled. Before analyzing this theme,
however, we will recover historical memory, reviewing the history of
light and electric energy in the country and what it has meant for
Mexicans.<br><br>
A History of Light in México<br><br>
Electric energy began in México at the end of the nineteenth century
during the presidency of Porfirio Díaz (1877-1911), a period known as the
Porfiriato. In 1879 the first electric energy plant, a
thermoelectric generator, was installed in the city of León, Guanajuato
for the textile factory, La Americana. In those years, electric
energy was used by the incipient textile and mineral industries; very
little was used for municipal services, such as illumination of public
spaces. Electric lighting of public spaces began in 1881, when the
Compañia Mexicana de Gas y Luz Eléctrica took charge of public
residential lighting in the capital of the Mexican Republic. In
1885, the piping that distributed the gas for public lighting in the
capital was 100 kilometers long, including 50 lights that used electric
energy, 2,000 gas streetlamps and 500 oil streetlamps for the
neighborhoods far from the Center. Ten years after the appearance
of the first thermoelectric plan, the first hydroelectric plant began
operating in Batopilas, in the state of Chihuahua along the border with
the United States. In this way, the generator plants began to
expand beyond commercial needs, such as factories and mines, to lighting
for public spaces and affluent residences.<br><br>
Transnational companies of many kinds arrived in Mexico during the
Porfiriato, and this was when the electric sector took on the
characteristics of a public service sector. It was then that the
first forty ^Óarch^Ô lamps were installed in the central plaza of Mexico
City, along with one hundred lamps in the plaza of the Alameda Central,
and later along the Avenida Reforma and other major streets in the
capital. Demand for electricity attracted foreign companies like
the Mexican Light and Power Company, of Canadian origin, which set up
office in the capital in 1898 and later extended its operations to the
center of the country. In 1903, Porfirio Díaz granted this company
a license for the exploitation of the waterfalls of Tenango, Necaxa and
Xaltepuxtla. The plant of Necaxa, in the state of Puebla, was the
first major hydroelectric project in México, with six units and an
installed capacity of 31,500 MW; it began to transmit hydroelectric power
from Necaxa to México City in 1905. In this year, the Canadians had
already gained control of the Mexican Electric Company, the Mexican Gas
and Electric Company and of the Compañia Explotadora de las Fuerzas
Eléctricas of San Idelfonso. One year later, in 1906, this Canadian
company obtained new licenses from Porfirio Díaz and state authorities in
the states of Puebla, Hidalgo, México, and Michoacán, thereby further
extending its power. It also acquired the hydroelectric plant of
the Alameda River, the Light and Energy Companies of Toluca,
Temascaltepec and Cuernavaca. The company also began to increase
the capacity of the Necaxa plant and modernize those in Nonoalco and
Tepéxic. In this manner, the Mexican Light and Power Company became
the principal transnational company that supplied the majority of all
electric energy in México, and its dominance would continue until 1960
when the company was nationalized by the Mexican government. Forty
years later, in January 2002, Canadian ambassador to Mexico Keith
Christie expressed that energy sector reform was fundamental for the
growth of Canadian private investment in Mexico with this statement: ^ÓThe
Canadian companies could increase investments if Congress and the
President offer a larger competitive space for private
initiatives.^Ô<br><br>
In 1910, 50 MW of electric energy were produced in Mexico, 80% of which
was generated by the Canadian company, Mexican Light and Power
Company. With the beginning of the twentieth century came the first
force to standardize the electric industry through the creation of the
National Commission for the Promotion and Control of the Energy
Generating Industry, then known as the ^ÓCommissión Nacional de Fuerza
Motriz.^Ô In the second decade of the twentieth century the second
transnational company arrived to México, this time from the United
States. The American and Foreign Power Company installed three
interconnected systems in northern Mexico. In the west another
company expanded with foreign businessmen to form the Electric Company of
Chapala, based in the city of Guadalajara (in the state of
Jalisco). The south of the country continued untouched as if it did
not exist.<br><br>
At the turn of the twentieth century, energy was almost completely in the
hands of three private foreign companies: the Mexican Light and Power
Company, the American and Foreign Power Company, and the Electric Company
of Chapala. These three companies acquired licenses, plants and
equipment from most of the smaller companies, thereby extending their
power and distribution networks, and creating a monopoly that lasted for
twenty years. It seems that we have yet to learn from history or
even acquire common sense. The same thing will happen if we
continue to open the sector up to investment by huge transnational
companies. As in any sector of the economy, the big fish will
swallow the little ones.<br><br>
This was the state of the industry until December 1933 when interim
president General Abelardo L. Rodríguez sent the initiative that decreed
the creation of the Federal Commission of Electricity (CFE) to
Congress. This initiative considered electricity as a public
activity for the first time in the Mexican history. (Now, seventy
years later, we may return to considering electricity to be a private
utility.) Nonetheless, the transnational corporation^Òs pressure to
maintain their monopoly was so great that they succeeded in postponing
the CFE^Òs inauguration until 1937. This was thanks to the new
president, General Lázaro Cárdenas del Río. Military generals in
the past gave us homeland and sovereignty, rescuing strategic resources
from the hands of transnational corporations and delivering them into the
hands of the Mexican people. Today, it is the generals in Latin
America and the Caribbean who persecute and kill indigenous peoples,
displace entire communities and create an environment of terror so that
Shell, Texaco, Mobil Oil, Unión Fenosa, EDF, AES and other energy
companies can continue plundering the continent.<br><br>
The CFE, which was stillborn in 1933, came back to life in 1937.
The transnational corporations attempted to thwart the government^Òs plans
to control this strategic resource by suspending their expansion plans.
This is why in the first five years of the CFE, the installed capacity in
Mexico just slightly increased from 629.0 MW to 681.0 MW. In 1937,
Mexico had 18.3 million inhabitants and three companies controlled the
distribution of electric energy to 7 million people, just 38% of the
population. These three companies distributed electric energy
principally to the urban population that could pay for the service, and
not to the other 67% of the population living in rural areas.<br><br>
The CFE began to increase its energy generation capacity due to the
population increase and commercial demands. In spite of the
increased capacity, the CFE did not have sufficient distribution
networks, and it turned over nearly all of energy produced to the major
transnational corporations. Therefore, the CFE created its first
projects in four states: Guerrero (Teloloapan), Oaxaca (Suchiate and
Chía), Michoacán (Pátzcuaro), and Sonora (Ures and Altar). Shortly
thereafter, Cárdenas began to nationalize the electrical
industry.<br><br>
By 1946, the CFE had a capacity of 45,594 KW. World War II had
ended and foreign companies had ceased investing in Mexico, so the CFE
had to rescue the industry in order to make electric energy available for
resale. In 1949, President Miguel Alemán issued a decree that made
the CFE a decentralized public organization. In 1960, the CFE
provided 54% of the 3,208 MW of installed capacity in Mexico, the
Canadian Mexican Light and Power Company provided 25%, the American and
Foreign Power Company 12% and other companies made up the remaining
9%. Even so, 64% of the all Mexicans did not have
electricity. The private companies invested little and were
confronted with unions that demanded labor rights for workers.
Their protests during the 1950^Òs and 1960^Òs were part of a larger protest
that also included doctors and railroad workers, finally culminating in
the student massacre in Mexico City on October 8, 1968.<br><br>
On September 27, 1960, President Adolfo López Mateos nationalized the
electric industry, paying for the assets of transnational corporations
with public funds and external debt. For 52 million dollars, the
Mexican government acquired 90% of the American Light and Power Company
and committed to pay the debts of the company which were more than 78
million dollars. The Mexican government bought the American Foreign
and Power Company for 70 million dollars, promising to invest this money
in the country. When it acquired the Mexican Light and Power
Company, Mexico gained the following: 19 generator plants that served
Mexico City and the states of Puebla, Mexico, Morelos and Hidalgo, 16
hydraulic plants and 3 thermoelectric plants, 137 kilometers of
three-phase double circuit transmission line on a 220 KW system, two
transformer substations in Gordo, Mexico and El Salto, Puebla, 38
receptor substations connected to the network of transmission of 85 and
60 KV, a large number of transformer banks, 4,500 kilometers of primary
distribution lines of 6 KV, 11,000 transformers with a capacity of
670,000 KVA and 6,800 kilometers of low-tension lines. The
hydroelectric plants the Mexican government obtained include Necaxa,
Patla, Tezcapa, Lerma, Villada, Fernández Leal, Tlilán, Juandó, Cañada,
Alameda, Las Fuentes, Temascaltepec, Zictepec, Zepayautla and San
Simón. The thermoelectric plants include Nonoalco, Tacubaya and
Lechería. Mexico also received the building situated on the corner
of Melchor Ocampo and Marina Nacional in Mexico City, as well as all
furniture, office materials and equipment in the stations, thermoelectric
plants and hydroelectric plants. The Mexican people paid for all of
this.<br><br>
Next, the government legally guaranteed this resource to the Mexican
people by adding a sixth paragraph to Article 27 of the Mexican
Constitution which states: ^ÓThe Nation has the exclusive right to
generate, conduct, transform, distribute and supply electric energy with
the objective of preserving this public service. It will not grant
licenses for this activity, and the Nation will benefit from the natural
resources that are required for those purposes.^Ô This is the
^Ónon-tariff barrier^Ô to trade that the Fox administration intends to
eliminate with it^Òs reform to the electric sector. This would in
effect legalize what has been illegally and unconstitutionally occurring
for three years: the CFE delivers the production and distribution of
electric energy to the principal transnational corporations of Canada,
the United States, France, Japan, Germany and Spain.<br><br>
One year later, in 1961, the installed capacity of the CFE had reached
3,250 MW and it sold 25% of all energy produced. The CFE that
previously had no control over any of the foreign-owned central
electricity generators, now owned 54% of all generators and was able to
manage electric energy in Mexico. The social organization ^ÓCompañia
de Luz y Fuerza del Centro^Ô (LyFC) was created in 1963. The
transmission systems between the Operations Systems of the Northwest,
Northeast, North, East, West and Central were also integrated in the
sixties. Meanwhile, the South of the country was still ignored and
denied development. In the 1960^Òs more than 50% of public
investment in the sector went to infrastructure projects, such as the
energy generators of Infiernillo and Temescal. At the end of the
decade, Mexico had constructed 1.4 times as many energy generators as had
existed before. The construction of hydroelectric dams extended
everywhere, creating serious irreversible environmental problems and
expelling millions of poor people from their homes.<br><br>
By 1971, the CFE had an installed capacity of 7,874 MW. In this
decade, there was an even greater growth of installed central generators,
approximately 1.6 times as many as had existed before. In 1974,
LyFC was authorized to carry out those acts necessary for its dissolution
and liquidation. By this time, all systems of electric energy
transmission were interconnected, except in Baja California and Yucatán
(which were incorporated into the National Interconnected System in
1990), creating a system of energy transport that covered almost all of
Mexico. During the 1970^Òs, Mexico was also able to unify the
electric frequency used to 60 hertz throughout the country. In five
years, it became the greatest unification in the country, having already
changed the electrical frequency of domestic appliances for over 2
million customers, converted 32 central generators, with 87 units, and
adjusted 41 substations.<br><br>
In this manner, México initiated major infrastructure works while racking
up significant amounts of external debt. Investment in the CFE
decreased in the 80^Òs. Starting in 1982 with the presidency of Miguel de
la Madrid, Mexico began applying neoliberal policies and ^ÓStructural
Adjustment Programs^Ô imposed by the International Monetary Fund (IMF) and
the World Bank. Mexico quickly began to sell off its 1,115
parastatal businesses. In 1989, the Law of Public Service of Energy
was reformed to allow the Federal Executive to liquidate the LyFC,
encompassing both its structure and service functions. This
presidential decree affirmed, ^Óthose businesses with licenses will enter
or continue in dissolution and liquidation and loan services until
totally liquidated. At the conclusion of the Compañia de Luz y
Fuerza del Centro, and its associated companies (Compañia de Luz y Fuerza
de Pachuca, Compañia Mexicana Meridional de Fuerza, and Compañia de Luz y
Fuerza de Toluca), the federal government will establish an decentralized
entity with its own jurisdiction and rule which will lend services that
have been sold by said companies.^Ô The presidential decree that
created said decentralized entity did not come until 1994.<br><br>
México^Òs debt was then paid by selling off businesses, and was also
complimented by political ^Ódebt adjustment.^Ô In 1991, the installed
electric energy capacity had reached 26,797 MW. In the 90^Òs, the
government prepared to privatize electric energy once more.
President Ernest Zedillo (19942000) attempted to privatize electric
energy several times without success. Now, President Vicente Fox
has to pay the postponed bill and launch spurious arguments in order to
justify deregulating the energy sector in the same manner that has
brought hardships on the United States, Chile, Argentina, Guatemala and
Perú, among others.<br><br>
A Closer Look at Light<br><br>
Electric energy is generated through four available technologies:
hydroelectric (using water as an energy source); eolian (using air as an
energy source); thermoelectric (producing heat from hydrocarbons in
burning natural gas and diesel fuel, with water vapor from underground or
other means of using carbon); and nuclear (using enriched uranium).
In the beginning of 2002, México had 159 central energy generators
including External Energy Producers (PEE), or foreign investments.
All these centers have an installed capacity to generate 37,650 MW of
electric energy (in 1938 the CFE barely had a 64 KW capacity), and this
capacity includes the four PEE centers with a total capacity of 1,455
MW. Of this installed capacity, 62.3% is thermoelectric, 24.94% is
hydroelectric, 6.91% is from carbo-electric centers, 2.22% is geothermic,
3.62% is nuclear, and .01% is eolian. There is enough energy to
reach all people in México. Nonetheless, in the so-called ^Óactual
demand^Ô we are forced to recognize the needs of the largest energy
consumer in the world (the United States), and of the transnational
corporations that will move to the region as a result of the Plan
Puebla-Panamá and the Free Trade Area of the Americas. Because of
the energy demands of foreign interests, not all people in México will
have access to electric energy generated in México.<br><br>
To bring electricity from the plants to consumers we need networks of
transmission and distribution, integrated in lines of high, medium and
low conductivity. Electric substations serve to transform energy,
changing its characteristics (voltage and currents) in order to
facilitate its distribution. When the armed conflict surged in
Chiapas in 1994, the total network for energy transmission in the state
was 30,033 kilometers. In 2001, there were 38,848 kilometers with
the capacity of transmitting 113,556 MVA. Today there are 275
substations with 113,556 MVA and 1,371 with 33,078 MVA, 40,148 kilometers
of sub-transmission lines, 5,858 distribution circuits with a longitude
of 333,295 kilometers, 809,005 distribution transformers of 26,672 MVA,
221,079 kilometers of low-tension secondary lines and 488,132 kilometers
of lower voltage.<br><br>
There are 116,840 localities with electricity, of which 113,350 are rural
and 3,489 are urban. 94.7% of the Mexican population has access to
electric energy. In the last ten years, 52,169 small solar modules
have been installed in the same number of residences. As it does
not intend to invest much in the rural sector, for the CFE ^Óthis will be
the technology of greatest application in the future for the unresolved
populations of electricity in the rural environment.^Ô On the other
hand, the electric sector in the country has 930 service offices and 974
automatic tellers.<br><br>
At the end of September 2001, CFE and LyFC provided services to a total
of 24,609,000 clients in México, as well as taxes rising by 4.3% annually
since the conflict in Chiapas in 1994. Of all those clients, 87.95%
corresponded to the domestic sector that comprised 24.5% of CFE sales;
10.32% to the commercial sector that comprised 6.55% of CFE sales; .65%
to services with 3.19% of sales; and .49% to the agricultural sector that
represented 6.43% of CFE annual sales. Charges by the electric
sector have risen from 98.5% en 1998 to 98.8% in 2001. In 2001
total CFE sales were as follows: .18% were exported, 77.11% were sold
directly to the public, and 22.71% were administered by LyFC as service
to México City and the states of México, Hidalgo, Morelos and
Puebla.<br><br>
The CFE describes itself as, ^Óa first class business with operative
indicators.^Ô Nonetheless, the governmental campaign today attempts to
discredit CFE in order to force privatization: 1) selling the state
company^Òs installed generators so that private initiatives can take
charge of this economic activity; 2) liquidating the parastatal company,
simply shutting it down, and leaving this essential economic activity up
to private initiatives to take it over; 3) allowing private companies to
invest in that which has been exclusively the State^Òs, creating at once
internal competition and gradually creating the conditions to allow for
options 1 and 2. This third option is what Vicente Fox has opted
for while still repeating intermittently that CFE ^Ówill not be
privatized.^Ô Beyond that, Fox insists that the energy industry will
not be able to respond to growing demands without private investments,
and that those investments go towards Energy Reform that will also
improve the quality of electricity service and lower prices. On the
contrary, blackouts will become necessary.<br><br>
At the moment, there are four notable presidential lies. First,
this is a veiled privatization that will accelerate when foreign
corporations, the big fish, can eat the little fish, thereby returning
again to the beginning of the 20th century: energy controlled by a
handful of transnational corporations. Second, foreign
transnational investing has already been occurring unconstitutionally for
at least three years. Transnational corporations have made more
than 40 formal offers of investments and the majority of those have been
accepted. Third, energy privatization does raise energy
prices price increases accelerate when there is no competition and
monopolies prevail. An example of this is the case of California
where Enron raised energy costs so much that the state government had to
institute a program of rolling blackouts because the costs were beyond
the scope of the state budget. In Central America, service by
transnationals is of such dismal quality that they too regularly have
blackouts.<br><br>
The governmental campaign is accompanied by other measures: eliminating
subsidies, lowering state investments and strengthening a campaign to
publicly discredit the industry through false arguments. This
creates an environment where one could dare suggest that privatizing
energy is necessary to maintain the sovereignty of México, bringing the
classifications of ^Óprotectionist,^Ô ^Óretrograde,^Ô etc. When the
government maintains energy control in its hands, it is called a
monopoly. When energy control passes to the hands of a
transnational corporation, it is called ^Ófree trade.^Ô If we
subsidized the poor, it would cause a scandal. If we do not
subsidize the poor, that money is destined for large corporations or to
subsidize the bankers through Foboproa (80 billion dollar ^Óbanking fund
for the protection of savings^Ô, created during 95-96 Mexican government
bailout of the more than half of Mexican banks in default).<br><br>
Energy is a major business that can produce large profits, if it
continues to be considered as an integral part of national
sovereignty. The sector can be profitable and at the same time can
be subsidized to provide for the needs of the most vulnerable sectors of
the Mexican population. Once again, our sovereignty is in
danger. Can we defend it?<br><br>
Sources: Comisión Federal de Electricidad (CFE), Luz y Fuerza del Centro
(LyFC), Constitución Política de la República Mexicana, CIEPAC.<br><br>
<font size=2>Translated by <u>Megan A. Ybarra</u> for CIEPAC,
A.C<br><br>
</font><div align="center"><b>Gustavo Castro Soto<br><br>
<font face="Verdana"> The Center for Economic and Political
Investigations of Community Action, A.C. CIEPAC, <br>
</b></font></div>
<font face="Verdana" size=2>CIEPAC is a member of the Movement for
Democracy and Life (MDV) of Chiapas, the Mexican Network of Action
Against Free Trade (RMALC)
</font><a href="http://www.rmalc.org.mx/"; eudora="autourl"><font face="Verdana" size=2 color="#0000FF"><u>www.rmalc.org.mx</a></u></font><font face="Verdana" size=2>,
Convergence of Movements of the Peoples of the Americas
(COMPA</font><font face="Verdana" size=2 color="#0000FF"><u>www.sitiocompa.org</u></font><font face="Verdana" size=2>),
Network for Peace in Chiapas, Week for Biological and Cultural
Diversity
</font><a href="http://www.laneta.apc.org/biodiversidad"; eudora="autourl"><font face="Verdana" size=2 color="#0000FF"><u>www.laneta.apc.org/biodiversidad</a></u></font><font face="Verdana" size=2>
and of the International Forum
"The People Before Globalization", Alternatives to the PPP
</font><a href="http://usuarios.tripod.es/xelaju/xela.htm"; eudora="autourl"><font face="Verdana" size=2 color="#0000FF"><u>http://usuarios.tripod.es/xelaju/xela.htm<br><br>
</a></u></font><font face="Verdana" size=1>Note: If you use this
information, cite the source and our email address. We are grateful to
the persons and institutions who have given us their comments on these
Bulletins. CIEPAC, A.C. is a non-government and non-profit organization,
and your support is necessary for us to be able to continue offering you
this news and analysis service. If you would like to contribute, in any
amount, we would infinitely appreciate your remittance to the bank
account in the name of: <br><br>
</font>CIEPAC, A.C<br>
Bank: Banamex<br>
Account number: 7049672<br>
Sucursal 386<br>
San Cristóbal de las Casas, Chiapas, México. <br>
You will also need to use an ABA number: BNMXMXMM <br><br>
Thank you! CIEPAC<br>
Note: If you wish to be placed on a list to receive this English
version of the Bulletin, or the Spanish, or both, please direct a request
to the e-mail address shown below. Indicate whether you wish to
receive the email or the "attached file" (Word 7 for Windows
95) version.<br><br>
Email:
<font color="#0000FF"><u>ciepac@xxxxxxxxxxxxxx</u></font> <br>
Web page:
<a href="http://www.ciepac.org/"; eudora="autourl"><font color="#0000FF"><u>http://www.ciepac.org/</a></u></font>
(Visit us: We have new maps on the situation in Chiapas, and a
chapter with more information on the PPP)<br>
<div align="center"><font size=1>__________________________________________________________________________________________<br><br>
</font><font size=1>CIEPAC, A.C.<br>
Centro de Investigaciones Económicas y Políticas de Acción
Comunitaria<br>
Eje Vial Uno Numero 11<br>
Col. Jardines de Vista Hermosa<br>
29297 San Cristóbal, Chiapas, MEXICO<br>
Tel/Fax: en México 01 967 678-5832<br>
</font>Fuera de México +52 967 678-5832<br>
</div>
</html>
_______________________________________________
Ciepac-i mailing list
Ciepac-i@xxxxxxxxxxxxxxxxxxxxx
http://www.laneta.apc.org/mailman/listinfo/ciepac-i
--- from list aut-op-sy@xxxxxxxxxxxxxxxxxxxxxxxxxx ---
- Thread context:
- AUT: Reactionary ideology...........,
neil Wed 24 Jul 2002, 18:34 GMT
- AUT: Reactionary ideology and it's relationship to the capitalist class....,
Michael Handelman Wed 24 Jul 2002, 17:54 GMT
- AUT: Re: state capitalism,
Cercle social Wed 24 Jul 2002, 17:43 GMT
- AUT: [Ciepac-i] English Chiapas al Dia 279 I,
CIEPAC Wed 24 Jul 2002, 14:33 GMT
- AUT: End of state capitalism and social movement,
miychi Wed 24 Jul 2002, 09:29 GMT
- AUT: Interesting piece on Political Islam,
cwright Wed 24 Jul 2002, 02:33 GMT
- AUT: Fw: The Gathering Storm (readable version),
cwright Tue 23 Jul 2002, 22:36 GMT
- AUT: state capitalism,
neil Tue 23 Jul 2002, 18:44 GMT
[ Other Periods
| Other mailing lists
| Search
]