Cablegate: Mexico Ready to Support the Economic and Climate Change

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P 021734Z SEP 09
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC PRIORITY 8112
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE PRIORITY
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUEHC/DEPT OF INTERIOR WASHINGTON DC
RHEHAAA/NSC WASHINGTON DC
RUEHBO/AMEMBASSY BOGOTA 4257
RUEHZP/AMEMBASSY PANAMA 2463
RUEHTG/AMEMBASSY TEGUCIGALPA 1922
RUEHSJ/AMEMBASSY SAN JOSE 1921
RUEHGT/AMEMBASSY GUATEMALA 3866
RUEHSN/AMEMBASSY SAN SALVADOR 2729
RUEHMU/AMEMBASSY MANAGUA 1082

UNCLAS SECTION 01 OF 02 MEXICO 002616

SENSITIVE, SIPDIS

STATE FOR WHA/MEX, WHA/EPSC
STATE FOR EEB/ESC (MCMANUS AND DUGGAN)
STATE FOR L/OES (MCDONALD) and OES/OPA
DOE FOR G.WARD AND A.LOCKWOOD

E.O. 12958: N/A
TAGS: ECON ENRG EINV PGOV SENV MX
SUBJECT: MEXICO READY TO SUPPORT THE ECONOMIC AND CLIMATE CHANGE
PARTNERSHIP OF THE AMERICAS

1. (SBU) Summary: Energy Secretariat officials told State/WHA's
visiting Director for Economic Policy and Summit Coordination that
Mexico supports the Economic and Climate Change Partnership (ECPA).
The GOM wants to highlight an ongoing initiative to promote North
American standards for household appliances in Central America. GOM
officials reacted positively to the U.S. proposal to provide
targeted technical support to the Central American electrical
interconnection project, and promised to give sympathetic
consideration to U.S. participation as observer of the associated
policy-level process. End Summary.

2. (SBU) Matt Rooney, WHA Director for Economic Policy and Summit
Coordination and ECONOFFs met August 24 with Mexican Energy
Secretariat officials (Aldo Flores, Director General for
International Affairs; Leonardo Beltran, Director for International
Negotiations; Brenda Melendez, Director for Latin America) to
discuss next steps for ECPA.

3. (SBU) Mexican officials opened by expressing their support for
ECPA and asking Rooney about next steps. Beltran noted that Mexico
supports the Latin American Energy Association (OLADE) and suggested
that OLADE could be used as the secretariat or technical arm of
ECPA. (Note: OLADE, the umbrella association of the LAC Energy
Ministers, is heavily influenced by Venezuela, and counts Cuba,
Ecuador, Nicaragua, Venezuela, and Bolivia among its members. End
note.) Rooney responded that the US already is looking at the OAS
and other regional organizations to provide that kind of technical
support, but assured the GOM officials that the U.S. understood the
need to engage the broadest circle of regional institutions in ECPA.

REGIONAL ELECTRICITY CONNECTIONS
--------------------------------
4. (SBU) Rooney raised US interest in the SIEPAC Mexico-Central
America-Panama electricity connection project under the Mesoamerican
plan. He suggested that ECPA provided the U.S. with an opportunity
to support SIEPAC by helping encourage energy reforms and further
liberalization in the region. He also noted that the US previously
held an observer role in the Mesoamerican Summits process and
suggested that this observer role could be revived. Flores said
that while he personally supported the idea, other countries in the
region might not support having the USG participate as an observer.

5. (SBU) Emphasizing that the electricity interconnection project
has been a success because it is pragmatic and focused, Beltran said
the last unfinished piece in Guatemala should be completed by the
end of 2009. He welcomed US support for the process, and noted that
financial and technical assistance via OPIC, USAID and other
organizations would be useful. Flores added that many countries in
the region are suffering from reform fatigue, and discussing further
reforms would not advance the process far. Central America is
lacking infrastructure, said Flores, and what are really need now
are concrete projects to improve regional integration.

6. (SBU) Flores lauded the model USAID used in the Dominican
Republic in which local experts were used as advisors and suggested
such an approach would be worth replicating. For example, Mexico
could offer some of its experts as advisors. On financing, Flores
recommended channeling funds through some regional banks. The
Central American Development bank, for example, is more efficient
and less bureaucratic than the larger development banks or the OAS.

INTEREST IN ENERGY EFFICIENCY PROJECTS
--------------------------------------

7. (SBU) Rooney asked the GOM participants in the meeting to expand
on their ideas for ECPA initiatives. Beltran said that energy
efficiency projects provide the greatest impact for the least cost.
Mexico has an appliance exchange program which replaces old
refrigerators, light bulbs and air conditioners with newer, more
energy efficient models. Beltran added that the GOM is considering
replicating this model in other countries including Brazil. Mexico
would like to work on introducing an appliance standard throughout
the region, both for energy efficiency as well as competitiveness

MEXICO 00002616 002 OF 002

reasons. Rooney and Beltran agreed that it would be difficult to
create these standards, given the lack of a regional mechanism to
harmonize standards. Beltran also mentioned Mexico's Wind Energy
Research Center in Oaxaca. The GOM is already in contact with the
National Renewable Energy Laboratory about possible collaboration on
this center. Beltran was open to Rooney's suggestion that this
Center could form part of a hemispheric network of renewable energy
centers in the hemisphere, which would also include centers in Chile
and Peru.

8. (SBU) Comment: The GOM has been supportive of ECPA from the
outset, having immediately grasped our intention to depart from old
approaches to this often intractable issue. The ideas they have
brought forward are supportive of U.S. goals for ECPA and have the
right balance of regional vision and practical payoff. They would
welcome our support as they develop an implementation plan.

PASCUAL

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