Mexico's Supreme Court rules against electricity law favoring state-owned utility over private firms

A panel of Supreme Court justices in Mexico has ruled against President Andrés Manuel López Obrador's rules that favored the state-owned electrical power company over private power companies

MEXICO CITY -- A panel of Supreme Court justices in Mexico ruled Wednesday against President Andrés Manuel López Obrador’s rules that favored the state-owned electrical power company over private power companies.

The five-judge panel approved a resolution saying the president's approach violates constitutional guarantees of free competition in the power sector.

Previously, power plants bid to supply electricity based on providing the lowest price. But López Obrador gave the state-owned Federal Electricity Commission priority in selling power into the grid.

That put private, mostly foreign-owned power generators last in line, despite the fact they often produce cleaner power than the commission, which runs many power plants on fuel oil or coal.

The U.S. governmen filed an objection to the law, arguing the U.S.-Mexico-Canada free trade agreement prohibits favoring domestic companies over those from other member states.