Price and income elasticities of residential energy demand in Germany

Abstract

Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Price and Income Elasticities of Residential Energy Demand in GermanyIsabella Schulte * , Peter Heindl † July 2016 AbstractWe apply a quadratic expenditure system to estimate price and expenditure elasticities of residential energy demand (electricity and heating) in Germany. Using official expenditure data from 1993 to 2008, we estimate an expenditure elasticity for electricity of 0.3988 and of 0.4055 for space heating. The own price elasticity for electricity is -0.4310 and -0.5008 in the case of space heating. Disaggregation of households by expenditure and demographic composition reveals that the behavioural response to energy price changes is weaker (stronger) for low-income (top-income) households. There are considerable economies of scale in residential energy use but scale effects are not well approximated by the new OEDC equivalence scale. Real increases in energy prices show a regressive pattern of incidence, implying that the welfare consequences of direct energy taxation are larger for low income households. The application of zero-elasticities in assessments of welfare consequences of energy taxation strongly underestimates potential welfare effects. The increase in inequality is 22% smaller when compared to the application of rich and disaggregated behavioural response patterns as estimated in this paper.

Residential Electricity Consumption and Economic Growth in Algeria

“…From a macroeconomic perspective, most of the studies that analyze the relationship between residential energy and income, estimate the short-run and the long-run elasticity of residential demand for electricity. Among them, Silk and Joutz [24] refer to the USA, Holtedahl and Joutz [25] to Taiwan, Hondroyiannis [26] to Greece, Filippini and Pachuari [27] to India, Narayan and Smyth [28] to Australia, Atakhanova and Howie [29] to Kazakhstan, Halicioglu [30] to Turkey, Nasir et al [31] to Pakistan, Athukorala and Wilson [32] to Sri Lanka, Blázquez et al [33] and Romero-Jordán et al [34] to Spain, Atalla and Hunt [35] to the Gulf Cooperation Council countries, and Schulte and Heindl [36] to Germany. Very little attention has been given to regions such as Africa and Latin America.…”

Impact of COVID-19 on the Level of Energy Poverty in Poland

“…Since energy needs are satisfied from the income that is already available for consumption, i.e., after paying taxes and receiving transfer payments, therefore, when estimating the scale of energy poverty in Poland, it has been assumed that the energy-poor are those households whose expenditure on energy carriers per person exceeds 10% of their disposable income. As it is well known, energy demand is rather inflexible, especially in the case of low-income households [58]. In addition, energy consumption per capita in Poland does not change significantly [2].…”

Influence of social indicators in the consumption of domestic electricity for urban marginal areas of Guayaquil

“…Differences in household size, income level, labor access, education, number of children and elderly, number of female, electrical appliances own by the family and how many of them are high and medium power demand and finally the amount of 110 and 220 volts power plugs availability are likely to affect domestic decisions on electricity consumption. According to Shulte [8], household size and composition shows that there are considerable economies of scale in residential energy use. Larger households tend to use energy services more effectively compared to smaller ones, and households with low income or low expenditure budget will further increase the likelihood of energy related deprivation.…”