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

K.H. Cao, H.S. Qi, Raymond Li, C.K. Woo, A. Tishler and Jay Zarnikau ()

Utilities Policy, 2023, vol. 81, issue C

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.

Keywords: Price elasticity; Estimation experiment; Non-residential electricity demand; U.S (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:juipol:v:81:y:2023:i:c:s0957178723000012

DOI: 10.1016/j.jup.2023.101489

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