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Spatial dynamics of electricity usage in India

Author

Listed:
  • Ghani, Ejaz
  • Goswami, Arti Grover
  • Kerr, William R.

Abstract

India's manufacturing sector has undergone many spatial adjustments since 1989, including, for example, the organized sector's migration to rural locations, the powerful rise of informal manufacturing within cities, and the development of intermediate cities for manufacturing. This paper investigates the impact of these spatial adjustments for electricity usage in India’s manufacturing sector. Striking spatial differences in energy usage exist, and whether spatial adjustments exacerbate or alleviate energy consumption strains is important for issues ranging from reducing India's power blackouts to stemming rising pollution levels. Using detailed surveys for the organized and unorganized sectors, the analysis finds that electricity usage per unit of output in urban plants declined steadily during 1989-2010. In the rural areas, by contrast, electricity consumption per unit of output for organized sector plants peaked in 2000 and thereafter declined. Decomposing the observed trends in aggregate electricity usage from 2000 onwards, the paper finds that most reductions in electricity usage per unit of output came from reductions in existing sites of activity (defined through state-industry-urban/rural cells). The second biggest factor leading to reduced usage was lower usage in fast-growing sectors. By contrast, spatial movements of manufacturing activity across India did not significantly change usage levels and may have even increased them. This appears to have been in part because of the split nature of the mobility, with organized and unorganized sectors migrating in opposite directions.

Suggested Citation

  • Ghani, Ejaz & Goswami, Arti Grover & Kerr, William R., 2014. "Spatial dynamics of electricity usage in India," Policy Research Working Paper Series 7055, The World Bank.
  • Handle: RePEc:wbk:wbrwps:7055
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    References listed on IDEAS

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    Cited by:

    1. Duranton,Gilles & Ghani,Syed Ejaz & Goswami,Arti Grover & Kerr,William Robert, 2015. "The misallocation of land and other factors of production in India," Policy Research Working Paper Series 7221, The World Bank.

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    Keywords

    Energy Production and Transportation; Climate Change Mitigation and Green House Gases; Environment and Energy Efficiency; Energy and Environment; Energy Demand;

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