Mexican Municipalities Continue to Explore New Energy‑Related Fees and Charges

Mexican municipalities continue to develop fee and revenue structures applicable to projects in the energy sector, the constitutional validity of which depends on their specific design and whether they function as legitimate charges for public services or instead operate as mechanisms of regulatory or supervisory control.

The energy industry has tools to assess risks and develop effective defense strategies in an environment that remains subject to case-by-case constitutional review.

General Overview

During the final quarter of 2025, the Mexican Supreme Court of Justice (Suprema Corte de Justicia de la Nación or SCJN) ruled on several constitutional controversies involving the validity of municipal fee structures applicable to energy projects, reigniting the constitutional debate over the limits of municipal authority in nationally strategic sectors.

These decisions come against a backdrop in which, over recent years, numerous municipalities have incorporated fees, fines and other charges into their revenue laws that directly impact oil and gas and electric power generation projects. This trend reflects an ongoing structural tension between local financing needs and the constitutional framework governing the allocation of governmental powers.

The constitutional controversies renew a focus on the central practical distinction of whether a municipal fee or requirement constitutes a legitimate measure associated with the provision of public services, or whether – by virtue of its structure and practical effects – it operates as a mechanism for the control or supervision of energy‑related activities.

For industry participants, the core inquiry is how the local measure operates in practice: whether it imposes an economic burden directly tied to the energy activity itself, conditions the installation or operation of the project or, under the guise of a municipal regulatory framework, effectively serves as a gatekeeping mechanism for energy-project development.

From this perspective, the analysis of municipal fees linked to energy projects is fundamentally technical, focusing on purpose, calculation methodology and practical effects rather than on any automatic presumption that such charges are unconstitutional.

Current Constitutional Debate

Following an extensive line of case law in this area, the SCJN continues to adjudicate disputes involving municipal fee structures related to energy projects without having established a unanimous and definitive standard. Toward the end of 2025, the court invalidated certain fees contained in the revenue laws of municipalities in the states of Guerrero, Coahuila, Nayarit and San Luis Potosi; however, other matters resulted in tied votes that prevented the formation of binding precedent, confirming that the constitutional debate remains open and unresolved.

Existing precedents indicate that the decisive factor is the practical impact of the fee or charge. Municipal fee structures that exceed the scope of legitimate local administrative authority and function as mechanisms of regulatory or tax control over energy activities face a significantly heightened risk of invalidation.

This analytical approach is especially relevant in the context of renewable energy projects such as solar and wind facilities. In these cases, the risk of invalidation increases when municipalities impose licensing, authorization or permitting requirements that condition the installation or operation of a project, rather than limiting their charges to those clearly tied to the provision of municipal public services, such as civil protection or public safety.

Practical Implications for the Industry

In this landscape, existing criteria function primarily as a tool for risk assessment and management. It enables companies to preemptively evaluate whether a local fee structure may exceed municipal authority and formulate appropriate response strategies, ranging from technical adjustments or negotiations with local authorities to the pursuit of legal challenges.

From an institutional standpoint, the ongoing debate also creates opportunities for local authorities to refine their legislative drafting techniques when designing revenue structures. Careful attention to the stated purpose of the fee or charge, its calculation basis and its practical effects can materially reduce the risk of constitutional invalidation.

Final Considerations

The constitutional boundaries governing municipal fee structures applicable to energy projects continue to be defined on a case‑by‑case basis, depending on the specific regulatory design of each revenue measure and its actual impact on project installation and operation. Local measures that, by their structure or effects, introduce elements of regulatory or tax control over energy activities face a substantial risk of invalidation. By contrast, fees and charges that are clearly linked to the provision of municipal public services are carefully designed and do not directly interfere with energy operations may fall within the permissible scope of local authority.

For the energy industry, this evolving environment underscores the need for a technical and preventive analysis of local fees and charges applicable to each project, both at the planning and operational stages, while also providing concrete avenues for legal defense against revenue measures that exceed municipal authority. At the same time, no uniform or definitive rule has yet emerged; the future development of this area will largely depend on the legislative technique employed by municipalities and on the practical effects that each instrument has on energy-related activities.

Holland & Knight attorneys have extensive experience in the energy sector – including with matters related to oil and gas, electricity, liquefied natural gas, biofuels and renewable energy – working closely and in an integrated manner with colleagues in the corporate, tax, finance and litigation practices.

This multidisciplinary approach enables our attorneys to advise domestic and international companies on the design, development and consolidation of strategic energy projects, as well as on the recovery of undue payments and the formulation of regulatory compliance strategies, providing comprehensive legal support for risk management in an increasingly complex regulatory environment. Through its public policy and regulation practices, Holland & Knight also advises public authorities on the design and strengthening of regulatory instruments.

For more information or questions, please contact the authors.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.