An experiment in own-price elasticity estimation for non-residential electricity demand in the U.S.

K.H. CAO, H.S. QI, R. LI, Chi Keung WOO, Asher TISHLER, Jay ZARNIKAU

Research output: Contribution to journalArticlespeer-review

Abstract

This paper uses an experiment to identify what modeling decisions significantly affect estimates of own-price elasticity for non-residential (commercial and industrial) electricity demand in the United States (U.S.). Based on 174,240 panel data model runs involving 10,944 monthly state-level observations from the Energy Information Administration for 2001–2019, these decisions are parametric specification, estimation method, and treatment of cross-section dependence. As most of the many generated elasticity estimates are between 0.0 and −0.2, price-induced conservation is likely modest, thus justifying continued policy support for energy efficiency standards and demand-side management in the U.S. path to deep decarbonization. Copyright © 2023 Elsevier Ltd.
Original languageEnglish
Article number101489
JournalUtilities Policy
Volume81
Early online date13 Jan 2023
DOIs
Publication statusE-pub ahead of print - 13 Jan 2023

Citation

Cao, K. H., Qi, H. S., Li, R., Woo, C. K., Tishler, A., & Zarnikau, J. (2023). An experiment in own-price elasticity estimation for non-residential electricity demand in the U.S. Utilities Policy, 81. Retrieved from https://doi.org/10.1016/j.jup.2023.101489

Keywords

  • Price elasticity
  • Estimation experiment
  • Non-residential electricity demand
  • U.S

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