Electricity demand analysis and forecasting: A panel cointegration approach

Alaa El-Shazly

Energy Economics, 2013, vol. 40, issue C, 251-258

Abstract: This article analyzes the demand for electricity and provides out-of-sample forecasting at the sectoral level using a panel cointegration approach. The econometric model permits cross-sectional heterogeneity within a dynamic framework that incorporates information on relevant income and prices of domestic and foreign goods. Both the short-run dynamics and the long-run slope coefficients are allowed to vary across cross-sections. Also, the testing for unit roots and cointegration in panels allows for heterogeneous fixed effects and deterministic trends. Using Egyptian data, it is shown that the empirical model produces reliable ex-post forecasts near the end of the full sample period. These pseudo forecasts are representative of what one would expect if the forecasting relationship is stationary. The long-run parameter estimates are then used to conduct ex-ante forecasting under plausible assumptions for policy making.

Keywords: Electricity demand analysis; Forecasting; Panel cointegration (search for similar items in EconPapers)
JEL-codes: C51 C53 Q41 Q47 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:40:y:2013:i:c:p:251-258

DOI: 10.1016/j.eneco.2013.07.003

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