The estimation of the demand for electricity is important in the appraisal of power projects because it often affects the benefits of the projects. For projects that involve a decision about the timing of investment- when to install new capacity to meet the demand- the precision of the electricity demand forecast can be critical. For others, when electric tariff policy is involved, it is essential to relate the demand for electricity with tariffs through the use of an electricity demand model or demand elasticizes. In this paper, we discuss a commonly used demand model for electricity and demonstrate its use in our analysis.
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Find related papers by JEL classification: Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply
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