Elimina barreras y hace más flexible la entrada de inversiones. Faculta a generadores a celebrar contratos bilaterales y/o a vender su energía en el mercado eléctrico. Garantiza condiciones equitativas de competencia a todos los generadores, incluyendo a las unidades de CFE. Preserva la exclusividad del Estado en generación nuclear. Generación de Energía Eléctrica New legal framework for geothermal energy in Mexico

2 M EXICAN E NERGY R EFORM  R EFORM N ATIONAL W ATERS L AW CONSTITUTIONAL D ECEMBER, 2013 G EOTHERMAL ENERGY L AW A UGUST, 2014 S ECONDARY R EGULATIONS O CTOBER, 2014

3 M AIN FEATURES OF THE N EW R EGULATORY F RAMEWORK Recognition Activities to determine if an area be of interest for geothermal energy development Registration required in SENER Effective 8 months Does not grant exclusive rights in the area recognized Exploration Activities to corroborate existence of geothermal resources includes exploratory drilling Permission Title required Effective for 3 years, extendable for 3 more years Comprises areas up to 150 km² Grants exclusive rights to explore the geothermal resources in the designated area Exploitation Activities to generate electricity Government Concession Title required Effective 30 years, extendable Grants exclusive rights in areas up to 150 km² Geothermal Water exploitation Title required, issued by the National Waters Commission

C ONSULTATION WITH INDIGENOUS COMMUNITIES To carry out any of the activities regulated by the GEL, it is necessary to consult the people and / or indigenous communities that may be affected by the implementation of such activities.

O UTCOME OF THE G EOTHERMAL E NERGY L AW Before Energy Reform After Energy Reform 4 E XPLOITATION P ROJECTS. CFE N ATIONAL U TILITY E XPLOITATION P ROJECTS 15 E XPLORATION P ERMITS 11 A PPLICATIONS IN PIPELINE

6 I NVENTARIO N ACIONAL DE E NERGÍAS R ENOVABLES THE PERMITS AND CONCESSIONS GRANTED ARE AVAILABLE THROUGH THE SITE : HTTP :// INERE. ENERGIA. GOB. MX / PUBLICA / VERSION 4.3/

7 Source: Bertani, Ruggero, WGC, April Inventario nacional de energías renovables y CFE (october 2015) Proven Reserves 286 MW Probable Reserves 5,730 MW Possible Reserves 7,422 MW 15 Exploration Permits (508 MW) 2 Exploitation Concessions (50 MW) 77 MW additions to 4 CFE fields *11 Applications in pipeline Source M EXICO G EOTHERMAL P OTENTIAL – 13.4 GW 75% RESERVES PROSPECTIVE

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