Elements for the development of public policies in the residential sector of Mexico based in the Energy Reform and the Energy Transition law

Abstract

Mexico has entered in an important dynamic of structural changes in the energy area, proof of this, it is the Energy Reform 2013 and the Energy Transition Law published the last December 24th, 2015, thus it is important to carry out studies of the impacts of future politics in the consumption of the population, so this study estimate an energy demand system using microdata collected from 97,817 households in a National Households Income and Expenditure Survey (ENIGH acronyms in Spanish, Encuesta Nacional de Ingresos y Gastos de los Hogares) in the 20-years period from 1994 to 2014.The magnitudes of all the fuels are smaller than one indicating that electricity, LPG, gasoline and public transport are normal goods, while LPG is the most inelastic energy source. The geographic factor shows that households in the north of Mexico tend to consume more gasoline, whereas in the south of the country, the lowest share of LPG expenditure is reported. The rigorous evaluation of energy demanded in households will help policy makers to put forward more efficient reforms.