The Power consumption in Mexico reached 271,803 GWh in 2020
The indicator recorded a historical growth at a CAGR of 1.51% between 2017 to 2020
Why did power consumption in Mexico drop in 2020?
From 2000 to 2020, electricity consumption grew. In 2020, the power consumption went down due to the restrictions imposed by the Mexican government to curb the spread of COVID-19. By 2030, the annual power consumption is estimated to grow.
Mexico has a federal republic government and practices a free market economy. The country’s economy is more oriented towards manufacturing, an outcome of its North American Free Trade Agreement (NAFTA) with the US. The industrial sector has the largest share of electricity consumption followed by residential and commercial sectors. The major exports of Mexico are cars, computers, vehicle parts, and delivery trucks, whereas major imports are integrated circuits, refined petroleum, and office machine parts. The US, China, Germany, Canada, South Korea, and Japan are Mexico’s major trading partners.
Power consumption is the net electricity consumed by the end users by excluding losses and own consumption and after adjusting exports and imports in a calendar year (fiscal year in some cases). The unit is represented in Gigawatt hours (GWh) and the scope is limited to historic period.
Impact of COVID-19 on the power sector in Mexico
With respect to power sector, the electricity consumption in the country declined in 2020 as compared to 2019. Electricity demand from industrial and commercial sectors declined significantly due to national lockdowns. Several oil utilities operating in Mexico observed a steep decline in revenues due to a slump in oil demand and a steep fall in fuel consumption. For instance, Petroleos Mexicanos (PEMEX), a major electric utility in Mexico, reported a massive loss in 2020. The Mexican government categorized power sector projects as essential, and hence related activities were permitted to continue. However, projects faced delays due to lack of manpower and bottlenecks in equipment supply due to social distancing measures and lockdowns. For instance, the construction of a solar PV project in Sonora state was suspended for several weeks due to supply chain constraints arising due to the pandemic. Also, several utilities submitted force majeure claims to CRE due to delays in starting the commercial operation of power projects on the guaranteed date due to the pandemic.
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