CrossBorder Issues in Energy Development

1
Cross-Border Issues in Energy Development

2
Introduction

• A discussion of the who, the what and the how of
  energy projects in the Mexico-US border region.

3
GovernmentU.S.

• Federal
• Department of Energy
• Presidential Permit for electric transmission
  lines across the border
• Federal Energy Regulatory Commission/Bureau of
  Land Management
• Natural gas pipeline routes

4
GovernmentU.S.

• Federal (continued)
• USEPA has strong interest in border pollution
  issues/weighs in on FERC and DOE permits

5
GovernmentU.S.

• California
• State Lands Commission
• Provides approvals for pipeline routes over state
  lands
• California Air Resources Board
• Interested in border air quality issues

6
GovernmentU.S

• County governments
• Provide rights of way
• Air Pollution Control Districts
• Concerned with air emissions, particularly
  transported emissions
• City governments
• Concerned with economic developments and quality
  of life issues

7
GovernmentMexico

• Federal government
• Historically has provided strong, centralized
  approval process for energy projects
• SEMARNATSecretaría de Medio Ambiente y Recursos
  Naturales
• Environmental agency provides permits for power
  plants

8
GovernmentMexico

• State of Baja California
• More limited involvement in approval of power
  projects
• CFEComision Federal de Electricidad
• Owns and controls domestic power production,
  builds power plants through bid process with
  outside contractors

9
GovernmentMexico

• City government
• Limited involvement in projects

10
Environmental Issues

• Air
• Air emissions know no boundaries
• Air basins often stretch across borders
• Each country sets its own standards for healthful
  air
• Each country sets requirements for new facilities

11
Environmental Issues

• Air (cont.)
• Differing activities on each side of the border
  create different problems
• Agricultural activities including plowing,
  pesticide use, etc. create particulate problems
• Population growth increases emissions from
  homes, cars, etc.

12
Environmental Issues

• Air (cont.)
• Industrial activities are sometimes the most
  noticeable, and the focus of much attention

13
Environmental Issues

• Water
• The Mexico-U.S. border region is particularly
  arid
• Limited water supplies focus attention on water
  for cooling and industrial purposes
• Historical agricultural uses are ingrained in
  local society

14
Environmental Issues

• Water (cont.)
• Waste water, even untreated, has a high value
• Discharge water, especially if treated and salts
  are removed, has an even higher value
• Quantity, and not quality, of water is often
  deemed most important

15
Environmental Issues

• Land use
• Conflicts abound between tradition agricultural
  uses and greenfield industrial uses
• Agriculturally-based economies do not always
  welcome other uses, especially if water rights
  are involved
• Communal ownership of lands in Mexico presents
  unique problems for rights-of-way

16
Environmental Issues

• Habitat issues
• Construction in desert areas must contemplate
  protection of endangered species
• Similar concerns exists on both sides of the
  border
• Cultural and archeological concerns
• Pipelines create unique problems because of the
  scope of soil disturbance

17
Cross-border Politics

• Competition for jobs is fierce
• Many on the U.S. side believe Mexico is not doing
  enough to protect the environment
• Many on the Mexican side dont understand why the
  U.S. is pointing its finger, given pollution that
  flows south

18
Cross-border Politics

• Many in the U.S. fail to appreciate the
  population growth that has occurred in the border
  areas
• Many on the Mexican side believe that the U.S. in
  trying to keep Mexico a third-world country when
  it comes to energy

19
What This Means

• The border region is truly one region. With
  shared concerns, similar involvement by
  government and shared aspirations for strong yet
  sustainable growth, the two countries have have
  been tied together for decades. For each to
  prosper, these linkages must grow even stronger.