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Sources of Over-Costs and Distortions in State-Owned Utilities in Mexico

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  • Eduardo Martínez Chombo
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    Abstract

    This paper describes and tries to quantify the effects of some factors that have affected costs of state owned electric utilities in Mexico (energy losses, fuel and labor). It is noted that the impact of the increases in fuel prices on the electric utilities´ total cost in the last years has been important. However, the ´´over-cost´´ associated to energy losses and labor is also significant and comparable to the impact of the increase in fuel prices. The structure of cross subsidies in the industry is also described, pointing out that it is complex and makes the performance evaluation of the state owned electric utilities difficult.

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    File URL: http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/%7B5104F34B-D059-88CC-F718-BF5CB8ABF534%7D.pdf
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    Bibliographic Info

    Paper provided by Banco de México in its series Working Papers with number 2009-07.

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    Date of creation: Aug 2009
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    Handle: RePEc:bdm:wpaper:2009-07

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    Web page: http://www.banxico.org.mx
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    Related research

    Keywords: Electricity sector; state-owned utility; energy losses; CFE; LyFC.;

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