DAC'd in Mexico

Today we learned the facts of life regarding power bills in Mexico. Production of electricity is very expensive; the government very heavily subsidizes the costs. On our last bill (for 2 months), it said that the cost of production for the power we used was 1,931 pesos, but we were charged only 1,172 pesos. However, the more one uses the higher the rate; rates are steeply graduated. Thus, the first 150 kwh on a bill are only 0.65 pesos/kwh, the next 100 kwh are 1.7 each and the rate then jumps to 2.27. The last is about Can.$0.25. There is an even higher rate, but we have not used enough to get that. However, this is not the end of the story. If a customer uses more than 250 kwh./month for 12 months, then they are put into a completely different category, called DAC. If you get in this category, you no longer get any of the low rates and every kwh costs 3.9 pesos (i.e., over 40 cents/kwh). Actually, rates are going up on a monthly basis. They said that rates are already up over 20% since the beginning of 2008 and still 4 months to go. Once you’ve been “DAC’d”, you have to have 12 consecutive months of less than 250 kwh to get off or move to a new location! Our first full 2 month billing period, we used 609 kwh (i.e., over the 500 limit to avoid being DAC’d if we continued this for a year).

Actually, we thought we were doing pretty well. In the first month, we used 12.35 kwh/day. By the first full 2 month period, we had brought that down to 9.8 kwh/day. I just checked and during the month of August since our last reading, we have our consumption down to 8.25 kwh/day. That would leave us just about 250 kwh/month and on the borderline. We changed all our bulbs to florescent. The next thing on the agenda is to get a new refrigerator. We knew it does not work very well and I expect that it is an energy hog; replacing it was already on our priority list. However, with what we learned today, it has now been moved to the top of our list as an energy efficient frig should get us below the DAC limit. However, we could still have up to 250 kwh at the 3rd rate level, 2.27 pesos/kwh and pricey.

We also heard 2 lectures today on saving energy and on getting alternatives. Photovoltaics is becoming very big down here. Mexico has recently put in place a program to allow customers to trade power with the electric company. That is, during the day if you produce more power than you need, you can feed it into the grid; the meter goes backwards. Then at night, you can draw from the grid. There were several people at the meeting who have done that or are doing it. The amount of daily sunshine here is quite high, just slightly lower than Las Vegas. As a result, the economics of both photovoltaics and solar heating of hot water are very good and rapidly getting better. We are going to look into it. The fellow giving the lecture and doing consulting on this (his last name is Mills, BTW) says that the payback period is under 10 years now and rapidly getting shorter as power rates keep going up; however, that may be calculated for someone on the DAC rate. The huge surge in the price of oil is certainly changing many economic calculations. We are all going to need to pay much more attention to energy efficiency and alternative energy sources; the oil prices are also making these alternatives more viable economically.