Supporting a just transition in Mexico needs reliable finance estimates

This research paper by the NewClimate Institute examines the financial requirements for a just transition of the power sector in Mexico, focusing on the phase-out of fossil gas, the expansion of renewable energy, and the social support needed for workers and communities.

• To align with the Paris Agreement and economic efficiency, all new power plant capacity in Mexico should be based on renewables. The estimated investment for new renewable energy capacity is approximately $180 billion USD for the period 2023-2030 and again for 2030-2040, decreasing by about half for the 2040-2050 period.
• Expanding the electricity grid to support renewable build-out is estimated to cost between $10 billion and $160 billion USD between 2023 and 2030, though the lack of detailed grid plans makes these figures less reliable.
• Estimates for financial compensation for the early retirement of fossil gas-based power plants vary widely due to data confidentiality and methodology. Compensation needs could range from negative values—where replacing plants with renewables is an economic gain—up to approximately $9 billion USD.
• A socially just transition for workers and communities in Mexico requires a tailored, country-driven approach combining top-down coordination with bottom-up implementation. Potential funding mechanisms include transition funds for regional restructuring, social transition funds for vulnerable groups like indigenous communities, and compensation funds for affected workers.

APA

NewClimate Institute (2024). Supporting a just transition in Mexico needs reliable finance estimates. https://newclimate.org/resources/publications/understanding-finance-needs-for-a-just-transition-of-the-mexican-power

Chicago

NewClimate Institute. Supporting a just transition in Mexico needs reliable finance estimates. 2024. https://newclimate.org/resources/publications/understanding-finance-needs-for-a-just-transition-of-the-mexican-power.

Wikipedia

{{cite report |author=NewClimate Institute |title=Supporting a just transition in Mexico needs reliable finance estimates |date=8 May 2024 |url=https://newclimate.org/resources/publications/understanding-finance-needs-for-a-just-transition-of-the-mexican-power |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{newclimateinstitute2024supporting, author = {{NewClimate Institute}}, title = {{Supporting a just transition in Mexico needs reliable finance estimates}}, institution = {NewClimate Institute}, year = {2024}, month = may, url = {https://newclimate.org/resources/publications/understanding-finance-needs-for-a-just-transition-of-the-mexican-power}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }