Industrial companies' demand for energy based on a micro panel database -- Effects of CO{sub 2} taxation and agreements on energy savings
An econometric panel data analysis of industrial demand for electricity and energy is presented. In the panel energy consumption, production and value added are observed at company level. The authors estimate price and production elasticities for electricity and total energy (i.e. measuring the X per cent change in demand of say electricity of a one per cent increase in the price of electricity). The estimated price and production elasticities are allowed to vary according to company characteristics such as industrial sub-sector, company size, energy intensity and type of ownership. Most previous econometric studies on industrial energy demand use aggregate data, while a couple of micro level studies mainly employ cross-section analysis. To the knowledge this is only the second econometric study on industrial energy demand based on a large micro panel database. More than 2,700 Danish industrial companies during the period 1983 to 1995 are included in the model (covering the majority of all Danish industrial energy consumption). One advantage of micro data is that these data can be used to estimate the effect of an instrument like voluntary energy agreements. By entering a voluntary energy agreement a Danish company avoids paying the usual CO{sub 2} tax. Preliminary analyses suggest that there is a large positive gross reduction of electricity and total energy consumption of companies with energy agreements. However, the authors also find that companies would have had about the same reduction in electricity consumption if they had not entered into an agreement, but instead paid the full CO{sub 2} tax. Thus, the analysis suggests that the net effect on electricity use of the voluntary energy agreements is very low (perhaps even negative).
- Research Organization:
- Inst. of Local Government Studies (DK)
- OSTI ID:
- 20001863
- Resource Relation:
- Conference: 1999 ACEEE Summer Study on Energy Efficiency in Industry, Albany, NY (US), 06/15/1999--06/18/1999; Other Information: PBD: 1999; Related Information: In: Industry and innovation in the 21st century, proceedings, 854 pages.
- Country of Publication:
- United States
- Language:
- English
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