The global consequences of climate change and appliance adoption for peak electricity demand

Maren Ludwig and Stephen Jarvis

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Economic development, rising temperatures, and decarbonisation policy will have profound implications for electricity systems worldwide. Using data on appliance ownership and hourly electricity demand for a large, diverse set of countries, we provide new global evidence on how temperature affects electricity demand. Combining our estimates with climate and development projections, we show that the adoption and use of both air conditioning and electric heating will increase average per capita electricity demand in all regions by mid-century, with peak demand during periods of extreme heat or cold rising nearly twice as much. Global annual electricity grid costs increase by over $0.3 trillion per year in 2050, with the largest burden falling on low- and middle-income countries. Our findings underscore the growing importance of appliance adoption and climate change in electricity system planning.

Keywords: electricity demand; temperature; climate change; development (search for similar items in EconPapers)
JEL-codes: L94 Q40 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2026-08
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:140636

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