Determinant factors of suboptimal electrical tariff choice for business in Aguascalientes, Mexico

Abstract

The Mexican energy tariff system is complex, with an increasing block pricing structure and a two-part tariff with specific thresholds. This creates problems for businesses, as they may end up paying the most expensive tariff if they are not aware of their consumption. Additionally, many businesses are misclassified under the tariff scheme. Previous research has highlighted the importance of incorporating behavioral consumer variables into models, but the business sector has not been extensively studied from an energy perspective. This study aims to determine the factors that lead to biases in electric tariff choice in the business sector in Aguascalientes, Mexico. Data was collected from the Non-Residential Electricity Consumption Survey and utility billing data from 2019 and 2020. The results show that businesses that choose a residential tariff can benefit if their energy consumption is low and they are aware of their expenditure. The most common misclassified tariff is the PDBT scheme, which may be optimal for small businesses with high appliance energy demand or mid-sized businesses working less than four days a week. The great demand tariffs are recommended for small and mid-sized businesses with a high number of employees per square meter. The study highlights the problem of misinformation among businesses regarding their consumption and expenditure. The effects of tariff choice bias, such as the insurance effect for PDBT scheme, the overestimation effect for DAC, and the convenience effect for GDMTO consumers, were also identified.