Mexico Energy efficiency report

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1 Mexico Energy efficiency report Objective: 18% energy savings target for 3 Overview - (%/year) Primary intensity (EU=1)¹ % -- CO 2 intensity (EU=1) % -- CO 2 emissions per capita (in tco2/cap) % - Power generation - (%/year) Efficiency of thermal power plants (in %) % ++ Rate of electricity T&D losses (in %) % -- CO2 emissions per kwh generated (in gco2/kwh) % + Industry - (%/year) Energy intensity (EU=1) % + Unit consumption of steel (in toe/t) % ++ * and - for steel ++ Among the best performing countries + Above the EU average 1 - Below the EU average 1 --Among the worst performing countries Latest update: March 13 1 The European Union, as the best performing region, is used as the benchmark.

2 1. Overview 1.1. Policies: 2% energy savings for 12 In November the government adopted an energy savings program (PRONASE) for the period -12. It estimates the energy savings potential at 18 percent in 3, compared with a reference scenario. The plan identified seven priorities: road transport vehicles, lighting, household appliances, cogeneration, electric motors, energy efficiency standards for new buildings and water distribution. The Electric Power Savings Trust Fund (FIDE) launched the Program for Financing of Electric Energy Saving (PFAEE). This Program finances the substitution of old, inefficient refrigerators and air-conditioners by modern and more efficient equipment. It also provides financial support for the thermal insulation of homes. In addition, the cost of more efficient lighting is financed through a credit paid on electricity bills, which is largely recovered due to reduced electricity costs. The FIDE label is a voluntary label that identifies energy-efficient products on the Mexican market; it certifies that the product has met specific standards Energy consumption trends: rapid increase up to Mexico s primary energy consumption per capita is 1.6 toe, ie, 16 percent lower than the world average. Total energy consumption grew at the steady pace of 1.6 percent/year between and. Between and it grew at the faster pace of 2.4 percent/year, on average, despite a 3.6 percent decrease in due to the global recession. The share of oil in the country s total consumption is 54 percent (); it has fallen to the benefit of gas (3 percent in compared with 19 percent in ). Coal and biomass supply approximately 5 percent each, and nuclear and hydro 1.5 percent each. The share of industry (including non-energy uses) in total energy consumption has decreased steadily since (from 29 percent in to percent in ). The overall increase in the share of the power sector was slow, from 14 percent in to 19 percent in. Figure 1: Energy consumption trends by sector Mtoe Other Industry Power generation In electricity consumption per capita corresponded to almost 2, kwh, which is almost four times lower than OECD per capita consumption and around 27 percent lower than the world average. Total electricity consumption increased at the rapid and steady pace of 4.1 percent/year, on average, between and, despite a slight decrease in due to the global crisis. Mexico Country reports 2

3 Electricity makes up 17 percent of the country s final energy consumption. Industry consumes an increasing share of electricity consumption: 57 percent in compared with 53 percent in. Figure 2: Electricity consumption trends by sector 25 Industry Others TWh 1.3. Energy efficiency trends: increasing energy and CO2 intensities since In energy intensities were above their levels, mainly as a result of the deep recession in, when energy consumption decreased much less rapidly than GDP (total energy consumption decreased by 2 percent whereas GDP dropped by 7 percent). Further contributors to this poor performance were the increasing losses in the power sector and the negative impact of the other sectors (eg, buildings, transport and agriculture), whereas industry contributed to a decrease of the energy intensity. Figure 3: Energy intensity trends.8% - %/year.6%.4%.2%.% -.2% -.4% -.6% Total Power generation Industry Other 2. Power generation The efficiency of thermal power generation has been increasing rapidly since (from 38 percent to 43 percent in ). The efficiency of the power sector as a whole followed a similar trend. This recent improvement is due to the spread of gas combined cycle plants: in, the gas combined cycle power capacity accounted for 4 percent of the total thermal capacity. Mexico Country reports 3

4 Figure 4: Efficiency of power generation and thermal power plants Figure 5: Thermal electricity capacity, by technology % 3 1 Total power generation Thermal power plants GW 5 Steam Gas turbines Combined cycles The rate of transmission and distribution losses (T&D) in the Mexican grid is about 17 percent of the distributed volumes, which is much higher than the world average (9 percent). A large part of those losses are nontechnical losses (theft). Those losses have increased slightly over time (14 percent in ). Figure 6: Evolution of T&D losses % Industry 3.1. Policies: promotion of cogeneration The National Program for Sustainable Use of Energy -12 promoted the development of cogeneration. The actual cogeneration capacity of 2,8 MW is expected to increase to 3,5 MW in Energy consumption trends: smaller contribution from energy-intensive industries Industrial energy consumption has shown an erratic trend since, fluctuating in a range of Mtoe. In consumption stood 2.5 percent lower than in. Mexico Country reports 4

5 Figure 7: Trends in industrial energy consumption Mtoe The share of electricity in industrial energy consumption has increased very rapidly, reaching 38 percent in compared with 17 percent in. The market share of natural gas fell from 41 percent in to 31 percent in. The shares of coal and oil declined slightly. The contribution of energy-intensive industries has decreased since, from around 55 percent of industrial consumption to 49 percent in. The chemical industry is the most affected sector, since its energy consumption dropped to 1 percent in (from percent in ). 1% 9% 8% 7% 6% 5% 4% 3% % 1% Figure 8: Energy consumption of industry, by source % Biomass Heat Electricity Gas Oil Coal/Lignite 1% Figure 9: Energy consumption of industry, by branch 9% 8% 7% 6% 5% 4% 3% % 1% % Other Paper Non metallic minerals Chemical Steel 3.3. Energy intensity trends: slower energy intensity reduction since Industrial energy intensity (consumption per unit of industrial value added) fell at a pace of 2.5 percent/year over the period between and. The largest energy efficiency improvements were achieved in the chemical industry, which saw its energy intensity drop by nearly 6 percent/year, followed by the steel industry (average annual decrease of 3 percent) and the cement industry (annual decrease of 1.5 percent). Mexico Country reports 5

6 Figure 1: Trends in the energy intensity of industrial branches % -1% -** - -2% %/year -3% -4% -5% -6% -7% *Incl uding construction and mining **- for chemi cal industry Total* Steel Chemical Cement Paper Mexico Country reports 6

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