Billions Pour Into Mexico’s Power Grid to Fix Its Blackout Problem

MEXICO · BUSINESS

After years of reform-driven uncertainty, private capital is flooding back into Mexico’s blackout-prone power sector — a vote of confidence in a grid the government has struggled to keep stable.

A wave of deals for the power grid

Investment in Mexico’s struggling electricity sector is roaring back to life. A series of deals in power plants, renewables and grid upgrades signed in recent weeks is paving the way for President Claudia Sheinbaum’s roughly $56bn energy plan, with European, US and domestic developers all committing capital. Among them are Copenhagen Infrastructure Partners, the Spanish renewables firm Cox Energy, the asset manager BlackRock and the mining-and-infrastructure conglomerate Grupo México, which have collectively signed billions of dollars in agreements to expand the country’s power output and fortify its network. Even billionaire Carlos Slim is exploring a foray into battery storage.

Why private money is back

The turnaround follows a period in which Sheinbaum’s energy reforms left investors wary. In 2025, her government enacted a sweeping package that restructured the sector in favor of the state, requiring that at least 54% of the electricity dispatched to the national grid come from the state-owned Federal Electricity Commission, leaving up to 46% for private producers. The reforms also dissolved Mexico’s independent energy regulators, folding them into a single commission reporting to the executive. While that state-first framework initially raised concerns about regulatory transparency and investment risk, the government has since moved to streamline approvals and cut red tape for private firms — and the recent run of deals suggests developers are now finding the terms workable.

Fixing a blackout-prone system

The investment is aimed squarely at a grid that has struggled to keep pace with demand, suffering outages that threaten the industrial and manufacturing growth the government is counting on. Sheinbaum has argued that securing reliable electricity supply and modernizing the system are prerequisites for development. Her broader strategy, branded Plan México, targets the addition of roughly 22 gigawatts of new generation capacity by 2030, a portfolio of around 100 transmission-and-distribution projects, and a lift in the clean-energy share of the power mix toward 40% from about 22% today — combining new state-built combined-cycle and solar plants with the private renewables and storage projects now being signed.

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Why it matters

The deals are a notable signal at a time when Mexico has otherwise seen capital grow cautious — foreign investors have trimmed bond holdings, and overall investment has slipped as a share of the economy. A revival of private money into electricity, one of the most politically sensitive sectors, suggests that the state-led model can still attract capital where the returns and rules are clear enough. For a government betting on nearshoring and industrial expansion, a stable, growing grid is foundational — and the willingness of marquee names to commit is an early test of whether the strategy can deliver.

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