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Patterns in Residential Gas and Electricity Consumption: An Econometric Analysis

Ray-Shine Lee and Nirvikar Singh

Journal of Business & Economic Statistics, 1994, vol. 12, issue 2, 233-41

Abstract: Since a subset of households have zero gas consumption, the purpose of the study is to quantify potential energy conservation from increasing gas availability. The authors investigate individual consumption data of natural gas and electricity under two nonnested specifications: a sample selectivity model with homogeneous normal error terms and a multiple regression model with heterogeneous distribution-free error terms of nearest-neighbor type. The prediction of energy conservation is that electricity demand could be reduced by 2473.47 kilowatt-hours a year per household if a gas connection is available to nonusers and the utility company would need to supply 611.09 therms of natural gas.

Date: 1994
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