Mitigating Vulnerability to High and Volatile Oil Prices
Power Sector Experience in Latin America and the Caribbean
Rigoberto Ariel Ypez-Garca
Julie Dana
2012 International Bank for Reconstruction and Development/The World Bank
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Washington DC 20433
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AttributionPlease cite the work as follows: Ypez-Garca, Rigoberto Ariel, and Julie Dana. 2012. Mitigating Vulnerability to High and Volatile Oil Prices: Power Sector Experience in Latin America and the Caribbean. Washington, DC: World Bank. DOI: 10.1596/978-0-8213-9577-6. License: Creative Commons Attribution CC BY 3.0
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ISBN (paper): 978-0-8213-9577-6
ISBN (electronic): 978-0-8213-9578-3
DOI: 10.1596/978-0-8213-9577-6
Library of Congress Cataloging-in-Publication data has been requested.
Cover photo: Offshore platform, Sonda de Campeche, Mexico; photo courtesy of PEMEX, Office of Communications.
Cover design: Naylor Design.
Contents
Foreword |
Acknowledgments |
Abbreviations |
Units of Measure |
Executive Summary |
Oil Price Evolution and Risk Exposure |
Who Bears the Risk Burden? |
Reducing Short-Term Price Uncertainty |
Reducing Oil Consumption over the Long Run |
What Can Be Done |
How Much Can It Help? |
Chapter 1 | Introduction |
Effects of High and Volatile Oil Prices |
Study Background and Objective |
Structure of This Report |
Notes |
References |
Chapter 2 | Economic Effects of High and Volatile Oil Prices |
Effects of High Oil Prices |
Effects of Oil Price Volatility |
What Is the Risk Distribution? |
Summary Remarks |
Notes |
References |
Chapter 3 | Economic Indicators of Vulnerability: Analysis of Latin America and the Caribbean |
Oil Trade Dynamics |
Oil Exporter versus Importer |
Dynamics of Oil Price Hikes and Subsidies |
Summary Remarks |
Notes |
References |
Chapter 4 | Managing Oil Price Dynamics in the Power Sector: Experience in Latin America and the Caribbean |
Oil-Dependent Energy Mix and Cost of Power Generation |
Distribution of Costs and Risks |
Economic Impacts on the Sector |
Summing Up |
Note |
Reference |
Chapter 5 | Price Risk Management Instruments |
Overview of Instruments |
Risk Assessment |
Hedging Possibilities for Power Market Agents |
Institutional Frameworks for Commodity Risk Management |
Conclusion |
Notes |
References |
Chapter 6 | Diversifying from Oil-Fired Power Generation |
Potential for Non-Oil Generation: Central America and the Caribbean |
Potential Avoided Impact from Oil-Fired Generation |
Summary Remarks |
Notes |
References |
Chapter 7 | Investing in Energy Efficiency |
Supply-Side Efficiency |
Demand-Side Efficiency |
Better Energy Efficiency: Effect on Investment and Oil Consumption |
Overcoming Barriers to Energy Efficiency: Policy Instruments |
Summary Remarks |
Notes |
References |
Chapter 8 | Regional Energy Integration |
Regional Integration in Electricity |
Natural Gas |
Conclusion |
Notes |
References |
Chapter 9 | How Much Can It Help? |
Review: Effects of High and Volatile Oil Prices |
Reducing Oil Dependence |
What Can Be Gained |
Summing Up |
Note |
References |
Chapter 10 | Conclusions |
Appendix A | Country Development Indicators |
References |
Appendix B | World Bank Advisory Services: Managing Oil Price Exposure and Implementing Risk Management Strategies |
Approach |
Needs Assessment |