The structure of Australian residential energy demand
AbstractThis paper presents the first national-level econometric estimates of the residential energy demand system for Australia. We estimate an Almost Ideal (AI) demand system for electricity, gas, and other miscellaneous fuels (mainly oil and wood) using quarterly data for both the country as a whole and for a panel of the five most populous States. The national data set covers the period from 1969 Q3 to 1998 Q2, while the state level data is only available from 1984 Q3 onwards. According to the national-level data, the pairs of electricity and miscellaneous fuels and gas and miscellaneous fuels are significant substitutes, whereas electricity and gas - the two main fuels - may be complements. The panel model, in contrast, finds significant substitution possibilities between gas and miscellaneous fuels only. The cross-price elasticities between electricity and gas are positive but not significant. The gas own-price elasticity is zero in the national model and unit elastic in the panel model. A national model estimated over the same shorter time period still shows complementarity between electricity and natural gas but most results are insignificant. Both large time-series and cross-sectional dimensions are valuable in estimating elasticities. Compared to North American estimates, our results show greater own price and income elasticities for natural gas and the miscellaneous category. They also show more substitutability between natural gas and the miscellaneous category.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Australian National University, Centre for Resource and Environmental Studies, Ecological Economics Program in its series Working Papers in Ecological Economics with number 0101.
Date of creation: Mar 2001
Date of revision:
Contact details of provider:
Web page: http://incres.anu.edu.au/EEP/wp.html
This paper has been announced in the following NEP Reports:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- BAUWENS, Luc & FIEBIG, Denzil & STEEL, Mark, 1992.
"Estimating End-Use Demand : A Bayesian Approach,"
CORE Discussion Papers
1992052, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Im, Kyung So & Pesaran, M. Hashem & Shin, Yongcheol, 2003.
"Testing for unit roots in heterogeneous panels,"
Journal of Econometrics,
Elsevier, vol. 115(1), pages 53-74, July.
- Pasaran, M.H. & Im, K.S. & Shin, Y., 1995. "Testing for Unit Roots in Heterogeneous Panels," Cambridge Working Papers in Economics 9526, Faculty of Economics, University of Cambridge.
- Tom Doan, . "IPSHIN: RATS procedure to implement Im, Pesaran and Shin panel unit root test," Statistical Software Components RTS00098, Boston College Department of Economics.
- Chalfant, James A, 1987. "A Globally Flexible, Almost Ideal Demand System," Journal of Business & Economic Statistics, American Statistical Association, vol. 5(2), pages 233-42, April.
- Peter Pedroni, 1999.
"Critical Values for Cointegration Tests in Heterogeneous Panels with Multiple Regressors,"
Department of Economics Working Papers
2000-02, Department of Economics, Williams College.
- Pedroni, Peter, 1999. " Critical Values for Cointegration Tests in Heterogeneous Panels with Multiple Regressors," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 653-70, Special I.
- Bartels, R. & Fiebig, D., 1990.
"Integrating Direct Metering and Conditional Demand Analysis for Estimating End-Use Loads,"
1990-56, Tilburg University, Center for Economic Research.
- Robert Bartels & G. Fiebig, 1990. "Integrating Direct Metering and Conditional Demand Analysis for Estimating End-Use Loads," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 79-98.
- Bartels, R. & Fiebig, D.G., 1990. "Integrating Direct Metering And Conditional Demand Analysis Fr Estimating End-Use Loads," Papers 9056, Tilburg - Center for Economic Research.
- Hawkins, R G, 1975. "The Demand for Electricity: A Cross-section Study of New South Wales and the Australian Capital Territory," The Economic Record, The Economic Society of Australia, vol. 51(133), pages 1-18, March.
- Goldschmidt, Peter, 1988. "Domestic appliance energy usage in Western Australia," Energy Economics, Elsevier, vol. 10(2), pages 155-162, April.
- Bartels, Robert & Fiebig, Denzil G & Nahm, Daehoon, 1996. "Regional End-Use Gas Demand in Australia," The Economic Record, The Economic Society of Australia, vol. 72(219), pages 319-31, December.
- David L. Ryan & Yu Wang & Andre Plourde, 1996. "Asymmetric Price Responses of Residential Energy Demand in Ontario," Canadian Journal of Economics, Canadian Economics Association, vol. 29(s1), pages 317-23, April.
- Fiebig, Denzil G. & Bartels, Robert & Aigner, Dennis J., 1991. "A random coefficient approach to the estimation of residential end-use load profiles," Journal of Econometrics, Elsevier, vol. 50(3), pages 297-327, December.
- Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-26, June.
- Robert Bartels & Denzil G. Fiebig, 2000. "Residential End-Use Electricity Demand: Results from a Designed Experiment," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2), pages 51-81.
- Dumagan, Jesus C. & Mount, Timothy D., 1993.
"Welfare effects of improving end-use efficiency: Theory and application to residential electricity demand,"
Resource and Energy Economics,
Elsevier, vol. 15(2), pages 175-201, June.
- Dumagan, Jesus C. & Mount, Timothy D., 1992. "Welfare Effects Of Improving End-Use Efficiency: Theory And Application To Residential Electricity Demand," Working Papers 128113, Cornell University, Department of Applied Economics and Management.
- W. A. Donnelly, 1984. "Residential Electricity Demand Modeling in the Australian Capital Territory: Preliminary Results," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2), pages 119-132.
- Donnelly, W. A. & Diesendorf, M., 1985. "Variable elasticity models for electricity demand," Energy Economics, Elsevier, vol. 7(3), pages 159-162, July.
- Banerjee, Anindya, 1999. " Panel Data Unit Roots and Cointegration: An Overview," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 607-29, Special I.
- Maddala, G S & Wu, Shaowen, 1999. " A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 631-52, Special I.
- Osterwald-Lenum, Michael, 1992. "A Note with Quantiles of the Asymptotic Distribution of the Maximum Likelihood Cointegration Rank Test Statistics," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 54(3), pages 461-72, August.
- Rushdi, Ali Ahmed, 1986. "Interfuel substitution in the residential sector of South Australia," Energy Economics, Elsevier, vol. 8(3), pages 177-185, July.
- Dhrymes, Phoebus J, 1973. "Small Sample and Asymptotic Relations Between Maximum Likelihood and Three Stage Least Squares Estimators," Econometrica, Econometric Society, vol. 41(2), pages 357-64, March.
- Pourazarm, Elham & Cooray, Arusha, 2013. "Estimating and forecasting residential electricity demand in Iran," Economic Modelling, Elsevier, vol. 35(C), pages 546-558.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jack Pezzey).
If references are entirely missing, you can add them using this form.