Energy practices and population cohorts: the case of Mexico

Abstract

Developing countries are advancing towards universal energy access with high fertility rates and young population. Socio-demographic and economic evolutions will influence future energy consumption patterns. Herein, we use Mexico as a case study to estimate determinants of residential electricity consumption as well as the importance that a shift in generational preferences has on such energy demand. We build an original pseudo-panel of Mexican households to separately estimate generational and age effects on the use of electricity. Our findings are in line with the few studies performed for developed countries, but the magnitudes are four times stronger. This means that, as they grow older, younger generations in Mexico increase their electricity consumption at a much faster rate than in developed countries. This may represent a significant obstacle in the way of meeting future energy demand, particularly in the context of the energy transition.