A New Multidimensional Energy Poverty Index for Mexico
Using the Alkire-Foster methodology and ENIGH data from 2016 to 2024, this paper proposes a novel eight-dimensional Energy Poverty Index for Mexico that reveals a significant 29.1% reduction in energy poverty incidence, driven largely by improved affordability and communication access, while highlighting persistent and widening relative disparities across sociodemographic groups.
Original paper licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/). This is an AI-generated explanation of the paper below. It is not written or endorsed by the authors. For technical accuracy, refer to the original paper. Read full disclaimer
Energy is the invisible thread that weaves through the fabric of daily life, yet for billions of people, that thread is frayed or missing entirely. When we speak of energy poverty, we are not merely talking about a lack of electricity or the inability to light a room. It is a deeper condition where people cannot access the reliable, affordable, and safe energy services required to cook food, heat water, keep food from spoiling, or stay warm in winter and cool in summer. This deprivation limits what people can do and be, affecting their health, their ability to learn, and their capacity to earn a living. For decades, researchers have tried to measure this problem, often focusing on simple counts of who has a power line or who spends too much of their income on fuel. However, these single-number snapshots often miss the complex reality of how different kinds of energy deprivation overlap and interact within a single household.
A new study by Matías Carrasco-Jiménez offers a more complete picture of this issue in Mexico, tracking the situation from 2016 to 2024. Instead of looking at just one aspect of energy life, the researcher built a comprehensive index that weighs eight different dimensions of deprivation simultaneously. These dimensions range from the basics, like having access to electricity and using clean cooking fuels, to modern necessities like owning a refrigerator or having a way to communicate. Crucially, the study also includes a measure of affordability, checking if a family has enough money left over after paying for energy to meet their basic needs. By combining these factors, the study creates a multidimensional map of energy poverty that can show not just how many people are affected, but how deeply they are affected and which specific needs are going unmet.
The results reveal a story of significant, though uneven, progress. Over the eight-year period, the number of people in Mexico living in energy poverty dropped substantially. The study estimates that the share of the population facing these deprivations fell from about 30 percent in 2016 to roughly 23 percent in 2024. In terms of raw numbers, this represents a decline of seven million people, even as the country's total population grew. The intensity of the poverty also eased, meaning that those who remained in poverty were missing fewer essential services than before. The most dramatic improvements were seen in the ability to afford energy and in access to communication tools. The affordability dimension saw the largest absolute drop, a shift the author links directly to a period where the real value of the minimum wage in Mexico more than doubled. At the same time, the ability to communicate via phone or internet improved so much that the relative decline in deprivation for that category was nearly 72 percent.
However, the path to improvement was not a straight line for everyone, and some stubborn inequalities remain. While the overall number of people suffering from energy poverty fell, the gap between the most vulnerable groups and the rest of the population actually widened in relative terms. Indigenous communities and those living in rural areas continued to face disproportionately high rates of energy deprivation. In 2024, nearly 75 percent of the indigenous population was still considered energy poor, a figure that is more than three times the national average. Similarly, while the absolute number of poor people decreased in these groups, the relative distance between them and the non-poor grew larger. This suggests that while general economic policies helped lift many out of energy poverty, they did not reach the most marginalized communities fast enough to close the gap.
The study also highlights where the remaining challenges lie. While access to electricity and communication has improved, the ability to cook with clean fuels and heat water remains a significant hurdle. These two areas, along with the need for refrigeration, now make up the largest share of the remaining energy poverty. The research indicates that the problem is no longer just about having a power line; it is about having the right appliances and the fuel to run them. Furthermore, the study found that the improvements in affordability were driven largely by rising wages rather than changes in energy prices or subsidies, suggesting that income policy has been a more effective tool for reducing energy poverty in Mexico than traditional energy-sector interventions.
One of the most nuanced findings concerns how the study handles the definition of poverty itself. The researcher was careful to ensure that a family was not labeled as energy poor simply because they were poor in general. By using a specific weighting system, the study ensures that a household is only identified as energy poor if they lack access to essential services like electricity or clean cooking, in addition to having low income. This distinction is vital because it prevents the index from simply becoming a measure of general poverty. The study confirms that while income growth has helped, the structural barriers to energy access for the poorest and most remote communities remain the primary obstacle to eliminating energy poverty entirely.
The data also points to a surprising shift in how people access information and entertainment. The study initially noted a rise in the number of households lacking traditional entertainment devices like televisions or radios. However, a closer look revealed this was not a sign of worsening conditions, but rather a change in technology that the old measurement tools failed to capture. As smartphones became the primary way people access the internet and media, the decline in ownership of older devices like desktop computers or radios created a statistical illusion of deprivation. Once the measurement was adjusted to include smartphones, the picture of progress became even clearer. This highlights the importance of keeping measurement tools up to date with the rapidly changing reality of daily life.
Ultimately, the study paints a portrait of a country in transition. Mexico has made real strides in reducing energy poverty, driven largely by economic growth and rising wages that have put energy within reach of more families. Yet, the benefits of this progress have not been shared equally. The deep-seated disparities between urban and rural areas, and between indigenous and non-indigenous populations, suggest that broad economic gains are not enough to solve the problem on their own. The remaining energy poor are concentrated in specific regions and among specific groups who face unique barriers to access. To truly eliminate energy poverty, future efforts will need to target these specific gaps, focusing on clean cooking, water heating, and ensuring that the most vulnerable communities are not left behind as the rest of the country moves forward.
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