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The Impact of an Energy Efficiency Improvement Policy on the Economic Performance of Electricity-Intensive Firms in Ghana

Author

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  • Chui Ying Lee

    (Graduate School for International Development and Cooperation, Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan)

  • Samuel Lotsu

    (Akosombo Hydro Station, Hydro Generation Department, Volta River Authority, 28 February Road, Accra GA-145-7445, Ghana)

  • Moinul Islam

    (Graduate School for International Development and Cooperation, Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan
    Network for Education and Research on Peace and Sustainability (NERPS), Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan)

  • Yuichiro Yoshida

    (Graduate School for International Development and Cooperation, Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan
    Network for Education and Research on Peace and Sustainability (NERPS), Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan)

  • Shinji Kaneko

    (Graduate School for International Development and Cooperation, Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan
    Network for Education and Research on Peace and Sustainability (NERPS), Hiroshima University, 1-5-1 Kagamiyama, Higashi Hiroshima-ken 739-8529, Japan)

Abstract

This paper investigates the economic impact of an energy efficiency improvement policy on electricity-intensive firms in Ghana. The policy imposed a penalty on these electricity-intensive firms, which are referred to as special load tariff (SLT) customers, when their power factor was below 90%. This paper applies the regression discontinuity design (RDD) to the panel data of these SLTs ranging from 1994 to 2012, excluding those years characterized by energy crisis. The results show adverse impacts of the policy on the employment and salary levels of the firms in the long run, in particular, the small- and medium–voltage firms. The results indicate that small- and medium–voltage firms are economically vulnerable to the penalty policy in the long run and recommend two policies to overcome this challenge. Firstly, the penalty for power factor improvement should not be imposed identically across firms with different voltage levels. Secondly, firms that satisfy the power factor standard should receive subsidies to improve their competitiveness in the market.

Suggested Citation

  • Chui Ying Lee & Samuel Lotsu & Moinul Islam & Yuichiro Yoshida & Shinji Kaneko, 2019. "The Impact of an Energy Efficiency Improvement Policy on the Economic Performance of Electricity-Intensive Firms in Ghana," Energies, MDPI, vol. 12(19), pages 1-21, September.
    • Handle: RePEc:gam:jeners:v:12:y:2019:i:19:p:3684-:d:271028
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    References listed on IDEAS

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    2. Francisco Sánchez-Cubo & José Mondéjar-Jiménez & Alejandro García-Pozo & Guillermo Ceballos-Santamaría, 2021. "A Study of the Wages in the Spanish Energy Sector," Energies, MDPI, vol. 14(13), pages 1-10, July.
    3. Gideon Otchere-Appiah & Shingo Takahashi & Mavis Serwaa Yeboah & Yuichiro Yoshida, 2021. "The Impact of Smart Prepaid Metering on Non-Technical Losses in Ghana," Energies, MDPI, vol. 14(7), pages 1-16, March.
    4. Dan Yu & Bart Dewancker & Fanyue Qian, 2020. "The Identification and Rebound Effect Evaluation of Equipment Energy Efficiency Improvement Policy: A Case Study on Japan’s Top Runner Policy," Energies, MDPI, vol. 13(17), pages 1-18, August.

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