Why desalination doesn’t take off in Mexico
Desalination projects are so rare in Mexico because of high investment costs and operating model. In Mexico, unlike other countries it is not clear about who is responsible although water is the responsibility of municipalities.
Desalination still has a cost higher than all the other supply methods, and given the economic situation, operators cannot charge accurate rates to supply. Then, the desalination projects become unfeasible because there will be no source of payment from this source of financing.
Faced with this issue, municipalities opt for other water projects, most of the time drilling more wells or over-exploit aquifers.
In 2022, northern states faced a record drought, but rather than choosing desalination plants, water authority Conagua proposed major aqueduct projects.
Mexico’s desalination portfolio involves five projects in the Baja California peninsula and in Sonora state. One is underway, two suspended, tenders are being structured for another one, and one involves an early-stage proposal that would benefit the US, according to a database
The ongoing project is the 3.6bn-peso (US$181mn) Los Cabos desalination plant in Baja California state, on which Los Cabos water utility Oomsapas started work in December through a public-private partnership. A consortium comprising La Peninsular Compañía Constructora and Acciona Agua holds the 25-year concession to design, build, operate and maintain the plant, with construction expected to take
Late last year, there were plans to restart suspended projects, but updates have not been provided.
In 2021, the federal government announced two PPP tenders for that year to build a desalination plant in La Paz, Baja California Sur state, and modernize the city’s water distribution system. But the tenders were never launched.
A consortium led by Israeli firm IDE Technologies submitted in December a proposal to US authorities to build a US$5.5bn desalination plant in Puerto Peñasco, Mexico’s Sonora state, and sell the water to Arizona from 2027.
Arizona’s water infrastructure finance authority is analyzing the offer, but a decision is not expected before its next meeting.