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Pricing Natural Gas in Mexico: An Application of the Little-Mirrlees Rule

Author

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  • Dagobert L. Brito
  • Juan Rosellon

Abstract

The Mexican energy regulatory commission—Comision Reguladora de Energia (CRE)-has implemented a netback rule for linking the Mexican market for natural gas with the North American market. This paper describes the economic analysis that supported this policy. We show that the netback rule is the efficient way to price natural gas and it is in fact an application of the Little-Mirrlees Rule.

Suggested Citation

  • Dagobert L. Brito & Juan Rosellon, 2002. "Pricing Natural Gas in Mexico: An Application of the Little-Mirrlees Rule," The Energy Journal, , vol. 23(3), pages 81-93, July.
    • Handle: RePEc:sae:enejou:v:23:y:2002:i:3:p:81-93
    DOI: 10.5547/ISSN0195-6574-EJ-Vol23-No3-4
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    Citations

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    Cited by:

    1. Marina Tsygankova, 2008. "Netback pricing as a remedy for the Russian gas deficit," Discussion Papers 554, Statistics Norway, Research Department.
    2. Víctor Gerardo Carreón Rodríguez & Juan Rosellón, 2012. "Oil and Gas in Mexico," Working Papers DTE 540, CIDE, División de Economía.
    3. Rosellon, Juan, 2008. "Policy Research Supporting Policy Making: The CIDE-CRE Agreement," MPRA Paper 22419, University Library of Munich, Germany.
    4. Guerrero, Daniel & Rosellon, Juan, 2017. "Planeación Óptima de la Red de Transmisión Eléctrica de Baja California Sur [Optimal Planning of the Electricity Transmission Grid of Southern Baja California (Mexico)]," MPRA Paper 83708, University Library of Munich, Germany.
    5. Brito, Dagobert & Rosellon, Juan, 2004. "Implications Of The Elasticity Of Natural Gas In Mexico On Investment In Gas Pipelines And In Setting The Arbitrage Point," MPRA Paper 54115, University Library of Munich, Germany.

    More about this item

    Keywords

    Natural gas; welfare; pricing; Mexico; regulation; Little-Mirrlees Rule;
    All these keywords.

    JEL classification:

    • F0 - International Economics - - General

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