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Seasonal and Regional Residential Electricity Demand

Abstract:
Following the seminal work of McFadden. Puig, and Kirschner (1977) and the general availability of national microdata sets, residential energy demand studies have been conducted for electricity, natural gas, fuel oil. LP gas, and wood (see Garbacz, 1984, 1985). Using the National Interim Energy Consumption Survey (NIECS) data, Garbacz (1984) developed a three-equation model (demand, price, and appliance stock) to estimate national electricity demand using two-stage least squares (2SLS) for house-holds by month. This study builds on the previous work to estimate elasticities by month and by region. It is hypothesized that elasticities vary substantially between the heating and cooling seasons. Previous work by Acton, Mitchell, and Sohiberg (1980); Parti and Parti (1980); Archibald, Finifter, and Moody (1982); Murray et al. (1978); and Garbacz (1984) supports this. Houthakker (1980), Halvorsen (1978), and Murray et al. (1978) also have found differences in elasticities by region.

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Energy Specializations: Energy Modeling – Sectoral Energy Demand & Technology; Electricity – Markets and Prices

JEL Codes: Q41: Energy: Demand and Supply; Prices, Q48: Energy: Government Policy, C51: Model Construction and Estimation, C58: Financial Econometrics, D12: Consumer Economics: Empirical Analysis, Q54: Climate; Natural Disasters and Their Management; Global Warming, Q52: Pollution Control Adoption and Costs; Distributional Effects; Employment Effects

Keywords: Residential electricity demand, Three equation model, Two-stage least squares, Elasticities

DOI: 10.5547/ISSN0195-6574-EJ-Vol7-No2-9


Published in Volume 7, Number 2 of The Quarterly Journal of the IAEE's Energy Economics Education Foundation.