Electricity tariffs dropped in Mexico in 2015

31 Aug 2015

Mexico's state-owned power utility, the Federal Electricity Commission (Comision Federal de Electricidad, CFE), reports that electricity tariffs in Mexico were reduced between September 2014 and September 2015 by between 21% and 30% for industry and by between 8% and 18% in the commercial sector. In the residential sector, the CFE has calculated that the prices declined by between 2% for customers with low consumption and 7.8% for the customers with high consumption. The CFE announced it is the first year the residential consumers with low consumption was not hit by a price increase, which amounted to 4% annually from 2006 to 2014.
The CFE explains the reduction rates from a switch in the power mix, mainly from oil to gas. Thus, the share of natural gas in the power mix increased by 6 percentage points thanks to no critical natural gas supply shortage. In addition, the hydropower generation rose by 40% in 2014. As a results, fuel oil consumption was reduced by 45%, from 201,000 bbl/d in 2012 to 111,000 bbl/d in 2014.
In addition to reasons provided by the CFE, the fall of international oil and gas prices over the last year has certainly highly impacted the drop of end-user tariffs.

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