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Modelling aggregate domestic electricity demand in Ghana: An autoregressive distributed lag bounds cointegration approach

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Author Info

  • Adom, Philip Kofi
  • Bekoe, William
  • Akoena, Sesi Kutri Komla

Abstract

In spite of the varying supply boosting efforts made by various governments to deal with the existing demand–supply gap in the electricity sector, the incessant growth in aggregate domestic electricity demand has made these efforts futile. As an objective, this paper attempts to identify the factors responsible for the historical growth trends in aggregate domestic electricity demand quantifying their effects both in the short-run and long-run periods using the ARDL Bounds cointegration approach and the sample period 1975 to 2005. In the long-run, real per capita GDP, industry efficiency, structural changes in the economy, and degree of urbanisation are identified as the main driving force behind the historical growth trend in aggregate domestic electricity demand. However, in the short-run, real per capita GDP, industry efficiency, and degree of urbanisation are the main drivers of aggregate domestic electricity demand. Industry efficiency is the only factor that drives aggregate domestic electricity demand downwards. However, the negative efficiency effect is insufficient to have outweighed the positive income, output, and demographic effects, hence the continual growth in aggregate domestic electricity demand. As a policy option, we recommend that appropriate electricity efficiency standards be implemented at the industry level.

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Bibliographic Info

Article provided by Elsevier in its journal Energy Policy.

Volume (Year): 42 (2012)
Issue (Month): C ()
Pages: 530-537

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Handle: RePEc:eee:enepol:v:42:y:2012:i:c:p:530-537

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Web page: http://www.elsevier.com/locate/enpol

Related research

Keywords: Aggregate domestic electricity demand; ARDL Bounds cointegration; Ghana;

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Cited by:
  1. Solarin, Sakiru Adebola & Shahbaz, Muhammad, 2013. "Trivariate causality between economic growth, urbanisation and electricity consumption in Angola: Cointegration and causality analysis," Energy Policy, Elsevier, vol. 60(C), pages 876-884.
  2. Adom, Philip K. & Kwakwa, Paul Adjei, 2014. "Effects of changing trade structure and technical characteristics of the manufacturing sector on energy intensity in Ghana," Renewable and Sustainable Energy Reviews, Elsevier, vol. 35(C), pages 475-483.
  3. Liddle, Brantley & Lung, Sidney, 2013. "Might electricity consumption cause urbanization instead? Evidence from heterogeneous panel long-run causality tests," MPRA Paper 52333, University Library of Munich, Germany.
  4. Adom, Philip Kofi & Bekoe, William, 2013. "Modelling electricity demand in Ghana revisited: The role of policy regime changes," Energy Policy, Elsevier, vol. 61(C), pages 42-50.
  5. 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.
  6. Mohamed El Hedi Arouri & Adel Ben Youssef & Hatem M'Henni & Christophe Rault, 2014. "Energy Use and Economic Growth in Africa: A Panel Granger-Causality Investigation," CESifo Working Paper Series 4844, CESifo Group Munich.
  7. 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.

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