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On The Demand Dynamics of Electricity in Ghana: Do Exogenous Non-Economic Variables Count?

Author

Listed:
  • Ishmael Ackah

    (Economics and Finance Subject Group, Portsmouth Business School University of Portsmouth, UK)

  • Frank Adu

    (Department of Economics, KNUST, Kumasi, Ghana)

  • Richard Opoku Takyi

    (University of Knutsford, Accra, Ghana)

Abstract

The purpose of this study is to identify and quantify the effect of endogenous and exogenous economic factors on electricity demand in Ghana. The Structural Time Series Model is employed due to its ability to capture exogenous non-economic variables. The findings reveal that education has significant effect on electricity consumption in both the short and the long run. Education has inverse relationship with electricity consumption implying that the more consumers are educated, the less electricity they consume. The study also reveals that price changes have less impact on electricity consumption in the short run and that efficiency in electricity consumption has improved since 1971 and will continue for the next twenty years. The study recommends that more public education should be carried out to enhance energy conservation and also, realistic prices should be charge for electricity consumption to allow private investment into the sector.

Suggested Citation

  • Ishmael Ackah & Frank Adu & Richard Opoku Takyi, 2014. "On The Demand Dynamics of Electricity in Ghana: Do Exogenous Non-Economic Variables Count?," International Journal of Energy Economics and Policy, Econjournals, vol. 4(2), pages 149-153.
    • Handle: RePEc:eco:journ2:2014-02-4
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    References listed on IDEAS

    as
    1. Lester C. Hunt & Guy Judge & Yasushi Ninomiya, 2003. "Modelling underlying energy demand trends," Chapters, in: Lester C. Hunt (ed.), Energy in a Competitive Market, chapter 9, Edward Elgar Publishing.
    2. Adom, Philip Kofi & Bekoe, William & Akoena, Sesi Kutri Komla, 2012. "Modelling aggregate domestic electricity demand in Ghana: An autoregressive distributed lag bounds cointegration approach," Energy Policy, Elsevier, vol. 42(C), pages 530-537.
    3. Broadstock, David C. & Hunt, Lester C., 2010. "Quantifying the impact of exogenous non-economic factors on UK transport oil demand," Energy Policy, Elsevier, vol. 38(3), pages 1559-1565, March.
    4. Paul Adjei Kwakwa, 2012. "Disaggregated Energy Consumption and Economic Growth in Ghana," International Journal of Energy Economics and Policy, Econjournals, vol. 2(1), pages 34-40.
    5. John Dimitropoulos & Lester Hunt & Guy Judge, 2005. "Estimating underlying energy demand trends using UK annual data," Applied Economics Letters, Taylor & Francis Journals, vol. 12(4), pages 239-244.
    6. Ishmael Ackah & Frank Adu, 2014. "Modelling Gasoline Demand in Ghana: A Structural Time Series Approach," International Journal of Energy Economics and Policy, Econjournals, vol. 4(1), pages 76-82.
    7. Lester C. Hunt (ed.), 2003. "Energy in a Competitive Market," Books, Edward Elgar Publishing, number 2519.
    8. Philip Kofi Adom, 2011. "Electricity Consumption-Economic Growth Nexus: The Ghanaian Case," International Journal of Energy Economics and Policy, Econjournals, vol. 1(1), pages 18-31, June.
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    Citations

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    Cited by:

    1. Catherine Kuamoah, 2020. "Renewable Energy Deployment in Ghana: The Hype, Hope and Reality," Insight on Africa, , vol. 12(1), pages 45-64, January.
    2. Kwakwa, Paul Adjei, 2014. "Energy-growth nexus and energy demand in Ghana: A review of empirical studies," MPRA Paper 54971, University Library of Munich, Germany, revised 01 Apr 2014.
    3. Kwakwa, Paul Adjei, 2015. "An investigation into the determinants of hydropower generation in Ghana," MPRA Paper 68033, University Library of Munich, Germany.
    4. Ackah, Ishmael & Asomani, Mcomari, 2015. "Modelling Renewable Energy Economy in Ghana with Autometrics," MPRA Paper 63870, University Library of Munich, Germany.
    5. Ackah, Ishmael & Appiah-Adu, Kwaku & Ahunu, Linda, 2015. "What Factors Drive Energy Consumption in Ghana?," MPRA Paper 66095, University Library of Munich, Germany.
    6. Adom, Philip Kofi, 2016. "Electricity Supply and System losses in Ghana. What is the red line? Have we crossed over?," MPRA Paper 74559, University Library of Munich, Germany, revised 11 Nov 2016.
    7. Ackah, Ishmael, 2015. "On the relationship between energy consumption, productivity and economic growth: Evidence from Algeria, Ghana, Nigeria and South Africa," MPRA Paper 64887, University Library of Munich, Germany.
    8. Ackah, Ishmael, 2015. "Investing in the cheapest form of energy: efficiency practices of SMEs in rural Ghana," MPRA Paper 65332, University Library of Munich, Germany.
    9. Ishmael Ackah & Mcomari Asomani, 2015. "Empirical Analysis of Renewable Energy Demand in Ghana with Autometrics," International Journal of Energy Economics and Policy, Econjournals, vol. 5(3), pages 754-758.

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    More about this item

    Keywords

    electricity consumption; efficiency; economic factorsJournal: International Journal of Energy Economics and Policy;
    All these keywords.

    JEL classification:

    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q49 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Other
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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