Comisión Federal de Electricidad

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Comisión Federal de Electricidad

Type	Government-owned corporation
Founded	1937
Headquarters	Mexico City, Mexico
Key people	Alfredo Elias Ayub (CEO)
Industry	Electricity
Products	Electricity
Website	http://www.cfe.gob.mx

The Comisión Federal de Electricidad (English: Electricity Federal Commission) is the Mexican state-owned electric monopoly, widely known as CFE. It is the sole electric company and the second most powerful state-owned company in Mexico (after Pemex, Petroleos Mexicanos). The Mexican constitution states that the government is responsible for the control and development of the national electric industry, and CFE carries out this mission.

[edit] History of the CFE

In 1937, Mexico’s population amounted to 18.3 million inhabitants, from which only 7 million (38%) counted with the electric power system provided with serious difficulties by three private companies. Supply did not fulfill demands, power outages were constant and rates were too high. Besides, these companies were focused to urban markets, more profitable, without counting rural areas, where more than 62% of the population resided.

In response to this situation that refrained the economical development of the country, Federal Government decided to create, on August 14, 1937, the Comision Federal de Electricidad, which in its first stages was given to the task of constructing generating plants to fulfill demand, and with this, benefit more Mexicans by irrigation water, dragging and milling, but above all, for public and domestic lighting.

First CFE projects were started in Teloloapan, Guerrero; Pátzcuaro, Michoacán; Suchiate and Xia, Oaxaca; and Ures and Altar in Sonora. In 1938, the company had barely a capacity of 64 KW, which, in 8 years, roused till reaching 45,594KW. Then, private companies stopped investing and our firm was forced to generate power so these companies resold it.

In 1960, the country rated capacity was of 2,308KW, CFE contributed 54%, the Mexican Light 25%; the American and Foreign 12%; and the rest of the companies 9%. However, in spite these generation and electrification efforts, barely 44% of the population had electricity. The situation of the Mexican Power Sector encouraged the then President Adolfo López Mateos to nationalize the electric industry on September 27, 1960. Nationalization allowed Mexican government to develop a national grid to serve customers more efficiently and is seen as the last nationalistic project in Mexico.

Since then, the integration of Sistema Eléctrico Nacional (English: National Electric System), the Mexican State acquired the goods and installations of private companies, which operated in a seriously deficient manner, due to the lack of capital investment and the labor problems they were facing.

In 1961 the total rated capacity in the country amounted to 3,250MW. CFE sold 25% of the power it produced and its share in the ownership of electricity generating plants went from 0% to 54%. In a little more than 20 years, one of the most important goals of our company was: to become the governing entity of electric power generation. During this decade, public investment was destined in more than 50% to infrastructure projects. With some of these resources important generating plants were built, Infiernillo and Temascal among them. In these years generating plants equaling 1.4 times what had been done up to then, were installed, reaching a rated capacity in 1971 of 7,874 MW.

By the end of the 70’s, the challenge to sustain the same growth rate was surpassed when between 1970 and 1980, generating plants equaling to 1.6 times were installed, resulting in a rated capacity of 17,360 MW. In the 80’s, the growth was less spectacular, mainly because of budgetary assignments reductions. Nevertheless, in 1991 the rated capacity amounted to 26,797 MW.

At present, the country’s rated capacity amounts to 46,672 MW* out of which 47.55% is produced by CFE thermal power plants; 19.85% to independent power producers (PIE); 22.04% to hydro power; 5.57% to coal fired power plants; 2.06% to geothermal power plants; 2.92% to nuclear power plants and 0.005% to wind driven power plants.

At one point, the initial development of the Mexican electric industry operated several isolated systems, with different technical characteristics; due to the diversification of technical standards, nearly 30 distribution voltages, 7 high voltages for transmission lines and 2 electrical frequencies of 50 and 60 hertz coexisted together.

These conditions made power supply to the entire country more difficult; therefore, CFE unified technical and economical criteria for the Sistema Electrico Nacional, it standardized operating voltages with the purpose of standardizing the equipment and reducing cost and manufacturing time, storage and inventory. Then the frequency was unified to 60 hertz throughout the country and integrated transmission systems with the Sistema Interconectado Nacional.

Other grate achievement referred to is the electricity transmission web, which actually gathers 46,688km of 400,230 and 161 kv lines; 327 power substations with a 135,238 MVA capacity; and 46,633 km of subtransmission lines of 138 kv and minor tensions. On the other hand, the distribution system (that was in .zero too in 1937), counts until today with 1,545 substations with a 40,719 MVA capacity; 6,775 distribution circuits 368,405 km length; 982,702 distribution transformers with a 32,189 MVA capacity; 235,951 km of secondary low voltage lines and 600,663 km of tapping.

Today, it is not only possible for 128,222 localities to have electricity power, but their inhabitants will receive a faster and more comfortable attention through 951 costumer service offices and 1,884 Cfematics, where you can pay your electricity bill at any time 365 days a year.

[edit] Constitutional reforms

During years, plans for a reform of the electric sector, which included private investments on CFE, have been discussed. Most of these plans have been rejected because customers perceive this as an "undercover privatization". Proponents claim that CFE has grown up to become a monopolic company, used by the federal government to control the electric industry and as a source of income. Critics point out the inefficient service provided by private gas companies (gas service was provided by CFE until 1997), and that customers have to pay high prices (even though they were told that the privatization of this service would decrease costs). Currently, critics claim that private utilities (which sell electric excedents to CFE) could be used as a first step towards a privatization.

[edit] Miscelaneous

Since the CFE is the only electric company in Mexico, most customers refer to it as "La comisión" (e.g. "The commission"). While there are other Mexican government commissions, the term is almost exclusively applied to the CFE.

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