IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v12y2019i19p3684-d271028.html
   My bibliography  Save this article

The Impact of an Energy Efficiency Improvement Policy on the Economic Performance of Electricity-Intensive Firms in Ghana

Author

Listed:
  • Chui Ying Lee

    (Graduate School for International Development and Cooperation, Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan)

  • Samuel Lotsu

    (Akosombo Hydro Station, Hydro Generation Department, Volta River Authority, 28 February Road, Accra GA-145-7445, Ghana)

  • Moinul Islam

    (Graduate School for International Development and Cooperation, Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan
    Network for Education and Research on Peace and Sustainability (NERPS), Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan)

  • Yuichiro Yoshida

    (Graduate School for International Development and Cooperation, Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan
    Network for Education and Research on Peace and Sustainability (NERPS), Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan)

  • Shinji Kaneko

    (Graduate School for International Development and Cooperation, Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan
    Network for Education and Research on Peace and Sustainability (NERPS), Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan)

Abstract

This paper investigates the economic impact of an energy efficiency improvement policy on electricity-intensive firms in Ghana. The policy imposed a penalty on these electricity-intensive firms, which are referred to as special load tariff (SLT) customers, when their power factor was below 90%. This paper applies the regression discontinuity design (RDD) to the panel data of these SLTs ranging from 1994 to 2012, excluding those years characterized by energy crisis. The results show adverse impacts of the policy on the employment and salary levels of the firms in the long run, in particular, the small- and medium–voltage firms. The results indicate that small- and medium–voltage firms are economically vulnerable to the penalty policy in the long run and recommend two policies to overcome this challenge. Firstly, the penalty for power factor improvement should not be imposed identically across firms with different voltage levels. Secondly, firms that satisfy the power factor standard should receive subsidies to improve their competitiveness in the market.

Suggested Citation

  • Chui Ying Lee & Samuel Lotsu & Moinul Islam & Yuichiro Yoshida & Shinji Kaneko, 2019. "The Impact of an Energy Efficiency Improvement Policy on the Economic Performance of Electricity-Intensive Firms in Ghana," Energies, MDPI, Open Access Journal, vol. 12(19), pages 1-21, September.
  • Handle: RePEc:gam:jeners:v:12:y:2019:i:19:p:3684-:d:271028
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/12/19/3684/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/1996-1073/12/19/3684/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Costantini, Valeria & Crespi, Francesco & Paglialunga, Elena, 2018. "The employment impact of private and public actions for energy efficiency: Evidence from European industries," Energy Policy, Elsevier, vol. 119(C), pages 250-267.
    2. Samuel Lotsu & Yuichiro Yoshida & Katsufumi Fukuda & Bing He, 2019. "Effectiveness of a Power Factor Correction Policy in Improving the Energy Efficiency of Large-Scale Electricity Users in Ghana," Energies, MDPI, Open Access Journal, vol. 12(13), pages 1-11, July.
    3. Depetris-Chauvin, Emilio & Santos, Rafael J., 2018. "Unexpected guests: The impact of internal displacement inflows on rental prices in Colombian host cities," Journal of Development Economics, Elsevier, vol. 134(C), pages 289-309.
    4. Vincent Pons & Clémence Tricaud, 2018. "Expressive Voting and Its Cost: Evidence From Runoffs With Two or Three Candidates," Econometrica, Econometric Society, vol. 86(5), pages 1621-1649, September.
    5. Magnani, Elisabetta & Zhu, Rong, 2012. "Gender wage differentials among rural–urban migrants in China," Regional Science and Urban Economics, Elsevier, vol. 42(5), pages 779-793.
    6. Sebastian Calonico & Matias D. Cattaneo & Rocio Titiunik, 2014. "Robust Nonparametric Confidence Intervals for Regression‐Discontinuity Designs," Econometrica, Econometric Society, vol. 82, pages 2295-2326, November.
    7. Sebastian Calonico & Matias D. Cattaneo & Max H. Farrell & Roc ́ıo Titiunik, 2017. "rdrobust: Software for regression-discontinuity designs," Stata Journal, StataCorp LP, vol. 17(2), pages 372-404, June.
    8. Rayton, Bruce A., 2003. "Firm performance and compensation structure: performance elasticities of average employee compensation," Journal of Corporate Finance, Elsevier, vol. 9(3), pages 333-352, June.
    9. Nilar Aung & Hoa‐Thi‐Minh Nguyen & Robert Sparrow, 2019. "The Impact of Credit Policy on Rice Production in Myanmar," Journal of Agricultural Economics, Wiley Blackwell, vol. 70(2), pages 426-451, June.
    10. Aino Tenhiälä & Tomi Laamanen, 2018. "Right on the money? The contingent effects of strategic orientation and pay system design on firm performance," Strategic Management Journal, Wiley Blackwell, vol. 39(13), pages 3408-3433, December.
    11. Zhang, Yi & Salm, Martin & van Soest, Arthur, 2018. "The effect of retirement on healthcare utilization: Evidence from China," Journal of Health Economics, Elsevier, vol. 62(C), pages 165-177.
    12. Allan, Grant & Hanley, Nick & McGregor, Peter & Swales, Kim & Turner, Karen, 2007. "The impact of increased efficiency in the industrial use of energy: A computable general equilibrium analysis for the United Kingdom," Energy Economics, Elsevier, vol. 29(4), pages 779-798, July.
    13. Hartwig, Johannes & Kockat, Judit & Schade, Wolfgang & Braungardt, Sibylle, 2017. "The macroeconomic effects of ambitious energy efficiency policy in Germany – Combining bottom-up energy modelling with a non-equilibrium macroeconomic model," Energy, Elsevier, vol. 124(C), pages 510-520.
    14. Magruder, Jeremy R., 2013. "Can minimum wages cause a big push? Evidence from Indonesia," Journal of Development Economics, Elsevier, vol. 100(1), pages 48-62.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wenxiao Chu & Francesco Calise & Neven Duić & Poul Alberg Østergaard & Maria Vicidomini & Qiuwang Wang, 2020. "Recent Advances in Technology, Strategy and Application of Sustainable Energy Systems," Energies, MDPI, Open Access Journal, vol. 13(19), pages 1-29, October.
    2. Francisco Sánchez-Cubo & José Mondéjar-Jiménez & Alejandro García-Pozo & Guillermo Ceballos-Santamaría, 2021. "A Study of the Wages in the Spanish Energy Sector," Energies, MDPI, Open Access Journal, vol. 14(13), pages 1-10, July.
    3. Gideon Otchere-Appiah & Shingo Takahashi & Mavis Serwaa Yeboah & Yuichiro Yoshida, 2021. "The Impact of Smart Prepaid Metering on Non-Technical Losses in Ghana," Energies, MDPI, Open Access Journal, vol. 14(7), pages 1-16, March.
    4. Dan Yu & Bart Dewancker & Fanyue Qian, 2020. "The Identification and Rebound Effect Evaluation of Equipment Energy Efficiency Improvement Policy: A Case Study on Japan’s Top Runner Policy," Energies, MDPI, Open Access Journal, vol. 13(17), pages 1-18, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zang, Emma, 2020. "Spillover effects of a husband's retirement on a woman's health: Evidence from urban China," Social Science & Medicine, Elsevier, vol. 245(C).
    2. Benoît SCHMUTZ & Grégory VERDUGO, 2020. "Do Politicians Shape the Electorate ? Evidence from French Municipalities," Working Papers 2020-18, Center for Research in Economics and Statistics, revised 01 Apr 2021.
    3. Samuel Lotsu & Yuichiro Yoshida & Katsufumi Fukuda & Bing He, 2019. "Effectiveness of a Power Factor Correction Policy in Improving the Energy Efficiency of Large-Scale Electricity Users in Ghana," Energies, MDPI, Open Access Journal, vol. 12(13), pages 1-11, July.
    4. Angelo D'Andrea, 2019. "Mayor’s wage and Public procurement," BAFFI CAREFIN Working Papers 19125, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    5. Mellace, Giovanni & Ventura, Marco, 2019. "Intended and unintended effects of public incentives for innovation. Quasi-experimental evidence from Italy," Discussion Papers of Business and Economics 9/2019, University of Southern Denmark, Department of Business and Economics.
    6. Sanchez-Vidal, Maria, 2019. "Retail shocks and city structure," LSE Research Online Documents on Economics 103394, London School of Economics and Political Science, LSE Library.
    7. Pan, Yao & Singhal, Saurabh, 2019. "Agricultural extension, intra-household allocation and malaria," Journal of Development Economics, Elsevier, vol. 139(C), pages 157-170.
    8. Hasan, Rana & Jiang, Yi & Rafols, Radine Michelle, 2021. "Place-based preferential tax policy and industrial development: Evidence from India’s program on industrially backward districts," Journal of Development Economics, Elsevier, vol. 150(C).
    9. Myerson, Rebecca & Lu, Tianyi & Yuan, Yong & Liu, Gordon, 2020. "The impact of government income transfers on tobacco and alcohol use: Evidence from China," Economics Letters, Elsevier, vol. 186(C).
    10. Cantoni, Enrico & Gazzè, Ludovica & Schafer, Jerome, 2021. "Turnout in Concurrent Elections : Evidence from Two Quasi-Experiments in Italy," The Warwick Economics Research Paper Series (TWERPS) 1343, University of Warwick, Department of Economics.
    11. Keita, Sekou & Mandon, Pierre, 2018. "Give a fish or teach fishing? Partisan affiliation of U.S. governors and the poverty status of immigrants," European Journal of Political Economy, Elsevier, vol. 55(C), pages 65-96.
    12. Riako Granzier & Vincent Pons & Clémence Tricaud, 2019. "Coordination and Bandwagon Effects: How Past Rankings Shape the Behavior of Voters and Candidates," NBER Working Papers 26599, National Bureau of Economic Research, Inc.
    13. Bratti, Massimiliano & Conti, Maurizio & Sulis, Giovanni, 2018. "Employment Protection, Temporary Contracts and Firm-Provided Training: Evidence from Italy," IZA Discussion Papers 11339, Institute of Labor Economics (IZA).
    14. Anderson, Drew M., 2020. "When financial aid is scarce: The challenge of allocating college aid where it is needed most," Journal of Public Economics, Elsevier, vol. 190(C).
    15. Bartalotti Otávio, 2019. "Regression Discontinuity and Heteroskedasticity Robust Standard Errors: Evidence from a Fixed-Bandwidth Approximation," Journal of Econometric Methods, De Gruyter, vol. 8(1), pages 1-26, January.
    16. Brassiolo, Pablo & Estrada, Ricardo & Fajardo, Gustavo, 2020. "My (running) mate, the mayor: Political ties and access to public sector jobs in Ecuador," Journal of Public Economics, Elsevier, vol. 191(C).
    17. Hansen, Benjamin & Miller, Keaton & Weber, Caroline, 2020. "Federalism, partial prohibition, and cross-border sales: Evidence from recreational marijuana," Journal of Public Economics, Elsevier, vol. 187(C).
    18. Verme, Paolo & Schuettler, Kirsten, 2021. "The impact of forced displacement on host communities: A review of the empirical literature in economics," Journal of Development Economics, Elsevier, vol. 150(C).
    19. Zhang, Yi & Salm, Martin & van Soest, Arthur, 2018. "The effect of retirement on healthcare utilization: Evidence from China," Journal of Health Economics, Elsevier, vol. 62(C), pages 165-177.
    20. Guastavino, Carlos & Miranda, Alvaro & Montero, Rodrigo, 2021. "Rank effect in bureaucrat recruitment," European Journal of Political Economy, Elsevier, vol. 68(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jeners:v:12:y:2019:i:19:p:3684-:d:271028. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://www.mdpi.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.