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The average hourly impact of price changes on household electricity consumption

Author

Listed:
  • Steven F. Koch

  • Yuxiang Ye

Abstract

This study evaluates the effect of marginal price changes on residential electricity consumption. The study is underpinned by hourly meter data that is matched to household level survey data in South Africa. It provides the first estimate of residential responses to price changes at the hourly level in a developing country. The price structure follows an incline block tariff allowing us to apply difference-in-differences. Our results uncover the expected negative relationship between price and electricity consumption, once we condition on both observed and unobserved confounding factors, especially temperature. We also find that relatively energy dependent households are less responsive to price changes than those less dependent.

Suggested Citation

  • Steven F. Koch & Yuxiang Ye, 2026. "The average hourly impact of price changes on household electricity consumption," ERSA Working Paper Series 250, Economic Research Southern Africa.
    • Handle: RePEc:rza:ersawp:250
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    File URL: https://ersawps.org/index.php/working-paper-series/article/view/250/220
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    References listed on IDEAS

    as
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    4. Auffhammer, Maximilian, 2022. "Climate Adaptive Response Estimation: Short and long run impacts of climate change on residential electricity and natural gas consumption," Journal of Environmental Economics and Management, Elsevier, vol. 114(C).
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

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    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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