They say knowledge is power. Sheinbaum holds a PhD and Master’s degree in energy engineering, plus a BA in physics. Furthermore, she is passionate about the energy transition, having worked in scientific research on the mitigation of climate change. But she now faces challenges from political opponents and industry bodies which are concerned about taking further investment risks in a volatile financial environment.

The National Autonomous University of Mexico (Universidad Nacional Autónoma de México – UNAM) graduate is targeting a significant expansion of clean energy. However, her planned reforms will keep the country’s publicly owned companies in control, while giving limited participation to private entities, potentially undermining past successes in lowering greenhouse gas emissions, experts warn.

Such a state-focused strategy is perhaps not a surprise, as Sheinbaum, 63, started her political career in 1989, in the then left-wing Party of the Democratic Revolution (Partido de la Revolución Democrática – PRD).

While in that party, she began a career in public service that took her to being appointed as the Environmental Minister of Mexico City in 2000. When the party split and the left-wing National Regeneration Movement (Movimiento de Regeneración Nacional – Morena) founded by Andrés Manuel López Obrador (known by his initials AMLO) – also her predecessor in the Presidency – was launched in 2011, she left PRD for Morena (in 2014). The move saw her become the elected Mayor of Mexico City in 2018.

While in charge, she supported the development of electromobility and sustainability, presenting the Mexico City Comprehensive Mobility Program 2019–2024, that included replacing gasoline-fuelled public transport buses with electric models, opening the door to private participation in this programme through tenders. These policies enabled Mexico City to receive a Sustainable Transport Award from the New York-based Institute for Transportation & Development Policy in 2025.

What has the new administration done?

As President since October 2024, one of Sheinbaum’s first decrees was to create a publicly funded electric vehicle (EV) assembly project called Olinia, that would invite private companies to participate at a later stage. ‘The project will have branches in every state and promote the use of electric and low-cost vehicles,’ according to a government press release. Its aim is to launch three EV models by the end of Sheinbaum’s term in 2030, costing Mexican Pesos (MXN) 90,000–150,000 ($4,813–8,023), in a country where the daily minimum wage is MXN 278.80 ($14.88).

‘Claudia has had good intentions in the sense that she has a less punitive stance towards private initiative [than her left-wing predecessor AMLO], and she sends kinder signs. However, those signs are not translated into sufficient rules and laws,’ says Miriam Grunstein, Founding Partner of Mexico’s Brilliant Energy Consulting.

Unlike AMLO, who restricted private investment in electric generation, cancelled long-term tenders and froze permit-issuing, President Sheinbaum appears to be moving in the opposite direction over electric power generation by setting up new schemes for private-sector investment, mainly in renewable energy, including joint ventures with the Federal Energy Commission (CFE).

Under Sheinbaum’s National Strategy for the Electricity Sector, presented in November 2024 soon after her election to office on 1 October, the CFE still aims to generate at least 54% of the country’s electricity. However, she plans to add 13,024 MW of generation capacity, 38% of which will be clean energy and 62% thermal energy, with the help of private companies. According to the CFE, in 2023 Mexico had an installed generation capacity of 88,748 MW, and CFE generated half of this power.

‘Claudia [Scheinbaum] has had good intentions in the sense that she has a less punitive stance towards private initiative [than her left-wing predecessor]... However, those signs are not translated into sufficient rules and laws.’ – Miriam Grunstein, Founding Partner of Mexico’s Brilliant Energy Consulting

The government also wants energy investment of up to $9bn from private companies during the next five years, Jorge Islas, Deputy Secretary of Planning and Energy Transition at Mexico’s Energy Ministry (Sener), told a forum on energy and natural gas organised by the Institute of the Americas in June 2025. ‘We want investments to generate between 6,400 MW and 9,500 MW of private investment by 2030,’ he added – the year Sheinbaum leaves office.

According to analysis from the Mexican Institute of Financial Executives (IMEF), Sheinbaum has promoted three schemes of private participation: long-term tenders to deliver energy directly to the CFE; private joint ventures formed with the CFE, with 54% CFE investment and 46% private investment; and allowing private companies to sell energy to the Mexican market.

Nevertheless, Grunstein believes this plan is flawed, arguing that the Mexican energy market is considered to be ‘too unattractive’ to generate significant private investment. A key problem, she explains, is the lack of funds commanded by Mexico’s state-owned petroleum and oil company Pemex (Petróleos Mexicanos) and the CFE – with the former reporting a $28bn debt at the end of 1Q2025. The US-based think tank Atlantic Council reported in March that the CFE, saddled with expensive and carbon-intensive infrastructure, lost close to $6bn in 2024.

‘If you don’t have money, how can you ask a private company to concede operative control [to Pemex and CFE], if all the money will come from the private operator? The operational decisions have an enormous influence on the profitability of the projects. Pemex and CFE want to make all those decisions without having money, and that makes a lot of things more complicated,’ comments Grunstein.

On behalf of the government, Sheinbaum plans to invest $23.4bn, comprising $12.3bn for generation, $7.5bn for transmission and $3.6bn for distribution by 2030, to address the insufficient energy distribution and transmission infrastructure in Mexico.

Transmission infrastructure in the country grew only 0.1% in 2023, according to a report from the Mexican Institute for Competitiveness (Instituto Mexicano Para La Competitividad – IMCO). ‘Between 2018 and 2023 the national transmission network grew 2.4%, going from 108,017 km to 110,559 km. The underinvestment in electric power infrastructure has been constant and the expended capital is far below the investment targets of the [CFE’s] planning mechanism for 2023–2028,’ the report said.

Administrative changes
However, not all Sheinbaum’s actions have pointed in the direction of clean energy and facilitating private participation. Among the first decrees she signed as Mexican President was one issued on 30 October 2024 to declare Pemex and CFE as Mexican ‘public companies’, changing from their previous status as ‘productive state companies’. Public companies are fully controlled by the Mexican government, without having to compete in the market.

‘Pemex and CFE are once again becoming companies of the people of Mexico,’ she said. Adding: ‘Our commitment is to ensure that they will be efficiently operated companies that will provide services, fuels and electricity at affordable prices.’

According to Article 28 of the Mexican constitution, ‘public companies are not considered monopolies’, a phrase that has the potential to spare CFE and Pemex from being accused of engaging in monopolistic practices that hinder private participation in Mexico’s energy system.

However, for some this was only a formalisation of the way in which those companies have already been operating. ‘This is the institutionalisation of a practice that had been happening: the government’s direct management of Pemex and CFE. Such change is more associated with procedures rather than implying an in-depth transformation,’ says Adrian Duhalt, a researcher in the Texas-Mexico Centre of the Southern Methodist University.

Fitch Ratings described Pemex in January 2025 as  ‘financially vulnerable’ and said its ESG (environmental, social and governance) track record further impairs its ability to raise capital. Some analysts consider it the most indebted oil company in the world, according to a Reuters report published in April 2025.

The President does seem to accept there are problems. On 26 June 2025, Sheinbaum said that the government was working on a scheme to improve Pemex’s financial situation. ‘What we are building is a long-term vision that will comprise financial actions and energy production,’ she said during her morning press conference that day.

To Duhalt, the problems of Pemex go beyond its finances: ‘I’m under the impression that there are a lot of operational inefficiencies in the day-to-day operations in Pemex. Should there be no changes regarding this issue, I believe that the results that the government expects will not be in the medium or long-term.’

He adds: ‘If the government’s intent is to reverse the fall in oil and natural gas production, it should focus on that issue and increase investment levels,’ noting Pemex’s 20F form presented to the US Securities & Exchange Commission (SEC) by non-American-owned US-listed companies shows that the company has regularly reduced investment in exploration and production.

Another one of Sheinbaum’s policies that was criticised by the private sector has been her abolition of independent autonomous regulatory bodies the Energy Regulatory Commission (CRE) and the National Hydrocarbons Commission (CNH), from 19 March 2025. According to the decree published on that day, these organisations were replaced with the Energy Ministry’s National Energy Commission. The action was described as a ‘backwards move’ in favour of monopolistic practices (against consumers) which compromises the fight against climate change, argued Mexico’s employers’ confederation Coparmex.

‘The CRE had a key role in regulation and supervision of energy markets, ensuring competitiveness, efficiency and transparency in services, said the President of Coparmex’s national energy commission Carlos Aurelio Hernández González in a memorandum published in February. At the time he commented: ‘The CNH has a crucial role in guaranteeing transparency and efficiency in tenders and contracts related to exploration and extraction of energy resources.’

Despite the criticism, Duhalt believes that it is too soon to predict the outcome of Sheinbaum’s policies. ‘When we look at the numbers, the formula [for Pemex and CFE] that we had before had questionable results... I believe it’s worthwhile to give her the benefit of the doubt,’ he said. ‘She will continue on López Obrador’s path, she will not desert fossil fuels. I believe that a country like Mexico cannot afford to quit investing in hydrocarbons, but we will see more renewable energy projects,’ he added.

Grunstein believes that Sheinbaum’s political affiliation will prove an obstacle to her achieving major change, including a clean energy transition, in Mexico’s energy system, given that AMLO focused on boosting fossil fuels, investing heavily in the construction of refineries, and other oil and gas projects. It will be tough for Sheinbaum to stray from these policies, given that the Morena party was founded by AMLO.

‘She’s a woman who is aware of the problems of the energy sector and she is trying to solve them. But her political debt will prevent her from being consistent with what she believes and wants,’ says Grunstein.

A sign of the political sensitivity of President Sheinbaum’s energy plans is that the Energy Ministry, the CFE, Pemex and the Mexican Association of Hydrocarbon Companies (AMEXHI), among other associations, did not respond to requests for comment for this article.

• Further reading: ‘Mexico’s zig-zag path towards the renewable energy transition’. Although Mexico is ideally positioned to become a clean energy powerhouse, since the election of President Andrés Manuel López Obrador it has swerved from significant focus on renewables back to fossil fuels, despite the urgency for energy transition. How did this happen and what are the implications for the future? 
• Latin America boasts abundant geothermal energy resources, but despite favourable conditions, only a fraction of its potential has been harnessed, a new report from Rystad Energy has found.