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U.S. commercial electricity consumption

Author

Listed:
  • Contreras, Sergio
  • Smith, Wm. Doyle
  • Fullerton, Thomas M., Jr.

Abstract

Commercial electricity usage exceeds that of industrial usage and is almost as large as residential electricity consumption in the United States. In this study, regional economic, demographic, and climatic data are used to analyze commercial electricity demand in the United States. Results indicate that total commercial demand for electricity is negatively related to price. In addition, the number of businesses and service income positively affect electricity demand for commercial use. The results are similar for equations estimated for kilowatt-hours demanded per business. The regional dummy variables exhibit different signs, which may occur due to climate factors because warm weather regions experience greater volumes of cooling degree-days, while cool weather regions observe larger amounts of heating degree-days. Although coefficients for the price of natural gas are positive, they do not satisfy the 5-percent significance criterion. The latter suggests that natural gas may not be a substitute good for electricity within the commercial sector of the U.S. economy.

Suggested Citation

  • Contreras, Sergio & Smith, Wm. Doyle & Fullerton, Thomas M., Jr., 2010. "U.S. commercial electricity consumption," MPRA Paper 34855, University Library of Munich, Germany, revised 22 May 2011.
  • Handle: RePEc:pra:mprapa:34855
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    File URL: https://mpra.ub.uni-muenchen.de/34855/2/MPRA_paper_34855.pdf
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    References listed on IDEAS

    as
    1. Xiao, Ni & Zarnikau, Jay & Damien, Paul, 2007. "Testing functional forms in energy modeling: An application of the Bayesian approach to U.S. electricity demand," Energy Economics, Elsevier, vol. 29(2), pages 158-166, March.
    2. Contreras, Sergio & Smith, Wm. Doyle & Roth, Timothy P. & Fullerton, Thomas M., Jr., 2009. "Regional Evidence regarding U.S. Residential Electricity Consumption," MPRA Paper 29093, University Library of Munich, Germany, revised 2009.
    3. Frank T. Denton & Dean C. Mountain & Byron G. Spencer, 2003. "Energy Demand with Declining Rate Schedules: An Econometric Model for the U.S. Commercial Sector," Land Economics, University of Wisconsin Press, vol. 79(1), pages 86-105.
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    More about this item

    Keywords

    Commercial Electricity Consumption; Regional Economics;

    JEL classification:

    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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