The intersection of AI and power law in Mexico: legal implications for a sustainable energy transition
Edmond Grieger
Von Wobeser y Sierra, Mexico City
Ariel Garfio
Von Wobeser y Sierra, Mexico City
Edmundo Berumen
Von Wobeser y Sierra, Mexico City
Alejandro Beas
Von Wobeser y Sierra, Mexico City
Héctor Sánchez
Von Wobeser y Sierra, Mexico City
Introduction
The global energy sector is undergoing a transformative shift, and Mexico stands at the crossroads of this energy transition. Additionally, Artificial Intelligence (AI) is poised to play a crucial role in modernising and optimising the energy industry, which can enable energy security, affordability and efficiency in the power sector. However, in Mexico the integration of AI may raise several legal and regulatory challenges. As a result, this article explores the intersection of AI and power law, focusing on key areas such as the smart grid, data centre power demands, AI in energy trading, and energy security issues related to AI.
The energy transition in Mexico
Mexico’s energy transition is driven by commitments to reduce greenhouse gas emissions and diversify the energy mix. To achieve this, the country has set ambitious goals to increase renewable energy generation, as outlined in its Energy Transition Law (Ley de Transición Energética). This commitment requires technological innovations, including the deployment of AI systems to manage complex energy networks and optimise resources.
The growing demand for electricity
The increasing demand for energy, driven by economic development, globalisation, and digitisation, poses a crucial challenge. Geopolitical conflicts, expansionist policies, and energy-intensive production processes are exerting mounting pressure on natural resources and ecosystems, exacerbating the climate crisis.
This rising energy demand places constant stress on electrical infrastructure, which faces significant challenges in providing equitable and reliable energy access. Transmission and distribution networks, often under strain, require substantial investment for the modernisation and expansion essential to guarantee the human right of access to energy. However, the scale of the investment required can be an obstacle, especially for developing countries, highlighting the need for innovative and efficient solutions for managing electrical infrastructure. AI can serve as a crucial tool in this regard, enabling long-term cost savings through resource optimisation and the more efficient allocation of economic resources.
Legal framework for AI in the energy sector
Mexico’s AI legal framework is still emerging, particularly in the context of the energy sector. Existing regulations, such as the Electricity Industry Law (Ley de la Industria Eléctrica) and the Hydrocarbons Law (Ley de Hidrocarburos), do not explicitly address AI. This creates uncertainties about liability, data governance, and compliance. Additionally, the General Law on Data Protection (Ley General de Protección de Datos Personales en Posesión de Sujetos Obligados) intersects with AI applications, especially concerning the use of data for predictive analytics and decision-making.
Key legal issues and opportunities
AI as an ally against climate change and energy demand
AI’s ability to analyse large volumes of information, process real-time data, identify patterns, and make predictions offers innovative solutions for optimising clean and renewable energy generation. It can predict and prevent failures in power plants, improve energy efficiency in industries, and enhance the resilience of electrical infrastructure against extreme weather events.
According to a recent report issued in 2024 by the International Energy Agency, there are proven cases of AI’s effectiveness in the electricity industry and in combating climate change. For instance, one of the largest renewable energy developers in Latin America, Atlas Renewable Energy, has been implementing AI for a more efficient operation and maintenance (O&M) activities. AI-driven predictive models optimise infrastructure operation based on weather conditions and enable compliance with power purchase agreements (PPAs) by accurately forecasting energy generation.
AI also plays a key role in climate adaptation by predicting extreme weather events, efficiently managing water resources, and monitoring ecosystems, demonstrating its potential as a transformative tool in energy and environmental sustainability. AI boosts the performance of renewable energy assets, as it makes them more agile and efficient, which results in more competitive prices and a reliable offer of clean energy for final users.
Smart grids
AI technologies, such as machine learning algorithms, can be the technology that finally scales up the development of smart grids, to optimise the grid operations by predicting energy demand, managing distributed energy resources, and enhancing fault or error detection. In Mexico, the National Centre for Energy Control (CENACE) controls and operates the National Grid in connection with the power sector, but the legal framework does not yet provide clarity on the adoption of AI-driven solutions nor the implementation of smart grids. To implement this kind of legal framework, issues of interoperability, cybersecurity, and accountability for AI-induced errors would need to be addressed to allow AI-driven solutions. Furthermore, integrating AI into the grid will require compliance with both national and international standards, such as those set by the International Electrotechnical Commission (IEC).
By balancing supply and demand intelligently, smart grids maximise renewable energy use without compromising system dependability. These grids represent a crucial step toward a future where energy is not only clean and sustainable but also intelligent and adaptable to evolving needs. Leveraging technology in this manner will create a more resilient and efficient energy system, empowering consumers, reducing environmental impact, and fostering a sustainable energy landscape.
Regardless of the above, in Mexico has a Programme for the Expansion and Modernisation of the National Transmission Grid,[1] as well as elements of the General Distribution Grids corresponding to the Wholesale Electricity Market (Programa de Ampliación y Modernización de las Redes Generales de Distribución 2024 – 2038), which contains a chapter dedicated to smart grids and how they are to be integrated into the national grid. It is important to point out that this programme does not explicitly contemplate the inclusion of AI, only mentioning the inclusion of ‘smart’ meters and technologies. However, it can be assumed that, in future, specific provisions on AI will be included in line with international trends.
Additionally, over the last year the state-owned Federal Electricity Commission (CFE), has held various tenders/auctions for the provision of services using AI, which demonstrates the growing trend towards the inclusion of AI in the national electricity system.
By embracing AI and modernising energy infrastructure, Mexico can position itself as a leader in sustainable energy development, ensuring a resilient and efficient electricity system meeting present and future demands while mitigating environmental impact.
Data centre power demands
The growing reliance on AI has led to a surge in the construction of data centres, which are energy-intensive facilities. In Mexico, the regulatory oversight of data centres is fragmented, with no specific laws governing their impact on the environment and energy. This raises questions about how to balance the energy demands of these facilities with national sustainability goals. Policymakers must consider whether to impose energy efficiency standards or incentivise the use of renewable energy sources for data centre operations.
AI in energy trading
AI is transforming energy trading by unlocking the flexibility to forecast renewable energy conditions, enabling real-time market analysis, predictive pricing models, and automated trading systems. Mexico’s wholesale electricity market (Mercado Eléctrico Mayorista) operates under the supervision of the Energy Regulatory Commission (CRE). While AI-driven trading platforms could enhance market efficiency, they also introduce risks, such as market manipulation and algorithmic bias. Legal safeguards must be developed to ensure transparency, fairness, and accountability in AI-driven trading activities.
Energy security issues relating to AI
As Mexico integrates AI into its energy infrastructure, concerns about energy security become important. AI systems are vulnerable to cyberattacks, which could disrupt critical energy supplies. The CENACE oversees grid security, but existing cybersecurity protocols may not be sufficient to address the advanced threats posed by AI-enabled attacks. Legislation should mandate robust cybersecurity measures, regular audits, and incident response protocols to mitigate these risks.
Policy recommendations
To address these challenges and maximise the benefits of AI in Mexico’s energy sector, the following five policy recommendations are proposed:
Develop comprehensive AI regulations
Mexico should establish a comprehensive legal framework for AI which addresses its application in the energy sector. This framework should include provisions for liability, data governance, and ethical considerations.
Enhance interagency coordination
Effective oversight of AI in the energy sector requires coordination between various regulatory bodies, including CFE, CRE, Ministry of Energy, and CENACE. A dedicated taskforce could streamline policy implementation and enforcement.
Promote public-private partnerships
Collaboration between the government and private sector can drive innovation while ensuring compliance with legal standards, especially for the implementation of AI in large energy infrastructure (eg, transmission and distribution). Incentives for research and development in AI-driven energy solutions should be prioritised.
Implement cybersecurity standards
To safeguard energy infrastructure, Mexico should adopt international cybersecurity standards and require energy companies to conduct regular vulnerability assessments.
Encourage renewable integration
Policies should recognise and incentivise the use of AI to integrate renewable energy sources into the grid, thereby supporting Mexico’s sustainability goals.
Conclusion
Mexico is an attractive market for clean and renewable energy development due to its geographical advantages and abundant resources. The electricity industry faces significant challenges, including: lack of modernisation of transmission and distribution networks, as outdated infrastructure impedes efficient energy distribution, requiring significant investment; and insufficient infrastructure for electricity transportation, the inability to move electricity efficiently from generation sites to consumption centres. These challenges limits industry growth and energy access. The intersection of AI and power law in Mexico also presents both opportunities and challenges.
As the country transitions to a more sustainable energy system, leveraging AI can enhance efficiency, reliability, affordability and security. However, these benefits can only be achieved through a robust legal framework which addresses the unique challenges posed by AI in the energy sector. By addressing these issues, Mexico can position itself as a leader in the global energy transition and AI technology.
Note
[1] Programa de Ampliación y Modernización de las Redes Generales de Distribución (PAMRNT) 2024–2038, www.cenace.gob.mx/Docs/10_PLANEACION/ProgramasAyM/Programa%20de%20Ampliaci%C3%B3n%20y%20Modernizaci%C3%B3n%20de%20la%20RNT%20y%20RGD%202024%20%E2%80%93%202038.pdf accessed 11 March 2025.