What article 42 says
The text is short and leaves little room for interpretation: the capacity of the authorized generation permit must be solely for the power that can be obtained using the thermal energy not used in the industrial processes associated with the cogeneration.
Read it again, because it changes the conversation. The ceiling of your project is not set by your electricity bill, by the engine someone wants to sell you, or by the space you have available. It is set by the waste heat your process generates and wastes today.
It is exactly what thermodynamics already said, now written as a permit requirement. And it means that any cogeneration proposal that starts from electricity consumption has the order reversed.
Why this is good news and not a restriction
Because it takes the most expensive mistake of this technology off the table: oversizing. An engine larger than the heat your process can absorb does generate electricity, but it runs outside the range that made it efficient, and the savings that justified the investment fall apart.
Article 42 puts a limit on that mistake. And it gives you an argument when you receive a proposal: if the bidder did not give you a heat balance, they cannot know what capacity can be authorized, and therefore cannot know what they are quoting you.
That is where the practical rule comes from: first measure how much heat your process throws away, at what temperature and for how many hours a year. Then size. Never the other way around.
The thresholds that do matter, with their article
Below 0.7 MW the plant is an Exempt Generator (Generadora Exenta) and does not require a generation permit (article 19). If it is also interconnected to a distribution circuit with a high concentration of load centers, it is Distributed Generation (article 25).
From 0.7 MW a generation permit is required, and it is granted by the National Energy Commission (Comisión Nacional de Energía, CNE), not the now-defunct CRE (articles 18 and 151). The permit can include the cogeneration modality.
Between 0.7 and 20 MW for self-supply the permit process can be simplified, under the guidelines the CNE issues (article 30). It is a fact that changes a project's timeline and rarely appears in a sales proposal.
For own use in emergencies or during interruptions of supply, a plant of any capacity does not require a permit (article 19, last paragraph). Backup generators fit there, and it is why backup has a much shorter regulatory path than generation.
Where our scope ends and where it does not
We work in distributed generation and inside your facility. Cogeneration under that scheme is ours: we identify the opportunity in the diagnostic, do the heat balance and the electrical engineering, and the proposal comes from a single team.
When the project crosses 0.7 MW, a permit with a filing window applies, and that development is handled by GIS Power. It is not a difference in company size: it is a difference in regulatory scheme, and it is worth knowing before sizing, not after.
And if the heat balance does not support the case, we tell you right there. We would rather lose the project than deliver an engine that rarely runs and never pays for itself.
Sources
Electricity Sector Law (Ley del Sector Eléctrico), DOF March 18, 2025 (articles 18, 19, 24, 25, 30 and 42) · Regulations of the Electricity Sector Law, DOF October 3, 2025.
No figure in this post comes from a blog or a press release. The four thresholds are the text of the law and you can verify them by article number.
The unused heat of your process sets the legal ceiling and the economic ceiling of your cogeneration. Without a heat balance there is no authorizable capacity, and without authorizable capacity there is no serious proposal.
