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Beginning from the premise that Mexico's economic strength will depend largely on its ability to produce, manage, and export energy, energy experts in this book analyze energy planning in Mexico in the 1970s and possible strategies for the future. They focus on the potential for diversifying the country's energy economy--now based almost exclusively on oil--by examining alternative sources, particularly natural gas, coal, and geothermal and solar resources. The extent to which Mexico's energy base is diversified, they assert, will determine the country's ability both to meet internal energy needs and to prolong its export of oil and gas. find, diversification will not only increase Mexico's economic strength, but will also expand the global supply of energy resources and have profound impact on the United States, Mexico's major trading partner.
Abstract The Mexican energy reform of December 2013 ended a long history of state-owned energy monopolies in the country, laying the grounds for direct private participation in an attempt to modernize this sector. Favorable political circumstances coupled with the negative effects of stagnation eased the way of the constitutional reform presented by the President, Enrique Peña Nieto, to Congress claiming that through this reform, the Mexican economy would grow around 1 percent by 2018 and 2 percent by 2025. The “hype” for oil spurred by the reform, was the subject of numerous media reports, academic forums and literature pieces in which every actor had a different opinion regarding who would be the main beneficiary of the “major” money flows that private investment would draw from oil developments, specially because the price for barrel of oil was around 100 dollars at the time. No one anticipated that by the end of 2014 this price would drop dramatically causing the “muteness” of these debates and shifting the government’s message from one of prosperity to one of austerity. This situation, although probably not permanent, gives us a preview of the inevitable: biophysical strains will increasingly tamper oil revenues as technically accessible fuels are depleted. Mexico needs then to pursue the de-carbonization of its economy in order to prevent a major crisis in this regard. The electricity industry has the potential to become the gateway towards this goal, providing that adequate measures are put in place to spur clean technology development. This not only to satisfy the country’s energy demands while contributing to climate change abatement, but also to create an innovation hub that can allow Mexico to compete in international markets exporting its technology around the globe. Mexico has a great capacity to satisfy its energy requirements through the deployment of renewable technologies. In terms of solar energy, 70% of its territory has Global Horizontal Irradiation Levels greater than 4.5 Kwh/m2; overall wind, geothermal, and hydropower energy potential has been estimated at 87,000MW, 8,000MW, and 53,000MW respectively; there are vast crop yielding lands available to undertake significant biomass generation efforts; and significant coastlands with considerable wave power that could make marine energy increasingly attractive in the future. Despite these promising levels, Mexico’s electricity matrix is still dominated by fossil fuels. Around 70% of the generation for public service provision is sourced through a combination of fuel oil, diesel, and natural gas, and although it is true that there have been policy efforts in the past aimed at spurring renewable energy deployment, they have mostly fallen to be “catalogues of good intentions” given that they lacked the stringency required to send the adequate price signals to promote an energy transition, as evidenced by the current electricity matrix itself. Hence, if energy transitional goals are to be pursued in order to access the benefits thereof, policy efforts that address both: technological research and development, and incentives to arouse the market, have to be developed. Task, which shall not be conducted “blindly”, but rather guided by best practices, derived from successful policy implementation examples across the world, keeping in mind the legal, economic and political viability of these policy alternatives within the Country. As such, this dissertation will provide an analysis of the framework that governed the Mexican electricity system previous to the reform, how this system is planned to work after, and the measures that this author believes Mexico should implement in order to advance in its path towards decarbonizing its finances while promoting economic growth, full electrification and climate change abatement, through an energy transition. This in light of internationally identified best practices, and taking into account feasibility considerations of the different policies available to achieve this goal within the Country.
Energy Resources mainly focuses on energy, including its definition, historical perspective, sources, utilization, and conservation. This text first explains what energy is and what its uses are. This book then explains coal, oil, and natural gas, which are some of the common energy sources used by various industries. Other energy sources such as wind, solar, geothermal, water, and nuclear energy sources are also tackled. This text also looks into fusion energy and techniques of energy conversion. This book concludes by explaining the energy allocation and utilization crisis. This publication will be invaluable to those interested in energy science.
This paper assesses the real effects of the energy reform in Mexico by looking at its impact on manufacturing output through changes in energy prices. Using sub-sector and state-level manufacturing output data, along with past variation in energy prices, we find electricity prices––relative to oil and gas––to be more important in the manufacturing process, with a one standard deviation reduction in electricity prices leading to a 2.8 percent increase in manufacturing output. Our estimated elasticities together with plausible reductions in electricity tariffs derived from the energy reform, could increase manufacturing output by up to 3.6 percent, and overall real GDP by 0.6 percent. Larger reductions are possible over the long run if increased efficiency in the sector leads electricity prices to converge to U.S. levels. Moreover, including the impact of lower electricity tariffs on the services sector, could lead to significantly larger effects on GDP. Accounting for endogeneity of unit labor costs in a panel VAR setting leads to an additional indirect channel which amplifies the impact of electricity prices on output.
Around the 1830s, parts of Mexico began industrializing using water and wood. By the 1880s, this model faced a growing energy and ecological bottleneck. By the 1950s, fossil fuels powered most of Mexico's economy and society. Looking to the north and across the Atlantic, late nineteenth-century officials and elites concluded that fossil fuels would solve Mexico's energy problem and Mexican industry began introducing coal. But limited domestic deposits and high costs meant that coal never became king in Mexico. Oil instead became the favored fuel for manufacture, transport, and electricity generation. This shift, however, created a paradox of perennial scarcity amidst energy abundance: every new influx of fossil energy led to increased demand. Germán Vergara shows how the decision to power the country's economy with fossil fuels locked Mexico in a cycle of endless, fossil-fueled growth - with serious environmental and social consequences.