Elasticities of the electricity demand in urban indian households
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Date
2002-03
Publication Type
Working Paper
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yes
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Abstract
Energy demand, and in particular electricity demand in India has been growing at a very rapid rate over the last decade. Given, current trends in population growth, industrialisation, urbanisation, modernisation and income growth, electricity consumption is expected to increase substantially in the coming decades as well. Tariff reforms could play a potentially important role as a demand side management tool in India. However, the effects of any price revisions on consumption will depend on the price elasticity of demand for electricity. In the past, electricity demand studies for India published in international journals have been based on aggregate macro data at the country or sub-national/ state level. In this paper, price and income elasticities of electricity demand in the residential sector of all urban areas of India are estimated for the first time using disaggregate level survey data for over thirty thousand households. Three electricity demand functions have been estimated using monthly data for the following seasons: winter, monsoon and summer. The results show electricity demand is income and price inelastic in all three seasons, and that household, demographic and geographical variables are important in determining electricity demand, something that is not possible to determine using aggregate macro models alone.
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published
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Volume
16
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ETH Zurich, Centre for Energy Policy and Economics
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Subject
Residential electricity demand; Price elasticity; Income elasticity
Organisational unit
03539 - Filippini, Massimo / Filippini, Massimo
02651 - Center for Energy Policy and Economics / Centre for Energy Policy and Economics
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Is previous version of: http://hdl.handle.net/20.500.11850/52237