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Electricity Demand in Pakistan: A Nonlinear Estimation

Author

Listed:
  • Saima Nawaz

    (COMSATS Institute of Information Technology, Islamabad)

  • Nasir Iqbal

    (Pakistan Institute of Development Economics (PIDE), Islamabad)

  • Saba Anwar

    (Pakistan Institute of Development Economics (PIDE), Islamabad)

Abstract

This study attempts to estimate the electricity demand function for Pakistan using smooth transition autoregressive model over the period 1971-2012. The empirical results have shown that there is nonlinear relationship between electricity consumption and economic growth and also between electricity prices and consumption. The income elasticity of electricity is high while price elasticity is less than unity. Further, results have shown that the average real prices are below the optimal level. The weak relationship between electricity demand and electricity prices is primarily due to lack of alternatives for electricity. Continuous investment in power sector is required to fulfill the future electricity needs

Suggested Citation

  • Saima Nawaz & Nasir Iqbal & Saba Anwar, 2013. "Electricity Demand in Pakistan: A Nonlinear Estimation," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 52(4), pages 479-492.
    • Handle: RePEc:pid:journl:v:52:y:2013:i:4:p:479-492
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    File URL: http://www.pide.org.pk/pdf/PDR/2013/Volume4/479-492.pdf
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    Citations

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    Cited by:

    1. Abdullah, Fahad Bin & Iqbal, Rizwan & Hyder, Syed Irfan & Jawaid, Mohammad, 2020. "Energy security indicators for Pakistan: An integrated approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 133(C).
    2. Nawaz, Saima, 2021. "Energy poverty, climate shocks, and health deprivations," Energy Economics, Elsevier, vol. 100(C).
    3. repec:ipg:wpaper:2014-514 is not listed on IDEAS
    4. Hussain, Anwar & Rahman, Muhammad & Memon, Junaid Alam, 2016. "Forecasting electricity consumption in Pakistan: the way forward," Energy Policy, Elsevier, vol. 90(C), pages 73-80.
    5. Jamal Bouoiyour & Refk Selmi & Muhammad Shahbaz, 2014. "The Electricity Consumption in a Rentier State: Do Institutions Matter ?," Working papers of CATT hal-01880334, HAL.
    6. Atif Naveed Khan & Kashif Imran & Muhammad Nadeem & Anamitra Pal & Abraiz Khattak & Kafait Ullah & Muhammad Waseem Younas & Muhammad Shahzad Younis, 2021. "Ensuring Reliable Operation of Electricity Grid by Placement of FACTS Devices for Developing Countries," Energies, MDPI, vol. 14(8), pages 1-21, April.
    7. Rauf, Huzaifa & Gull, Muhammad Shuzub & Arshad, Naveed, 2020. "Complementing hydroelectric power with floating solar PV for daytime peak electricity demand," Renewable Energy, Elsevier, vol. 162(C), pages 1227-1242.
    8. Shamaila Aziz & Muhammad Rizwan Yaseen & Sofia Anwar, 2016. "Impact of Rising Energy Prices on Consumer’s Welfare: A Case Study of Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 55(4), pages 605-618.
    9. Valasai, Gordhan Das & Uqaili, Muhammad Aslam & Memon, HafeezUr Rahman & Samoo, Saleem Raza & Mirjat, Nayyar Hussain & Harijan, Khanji, 2017. "Overcoming electricity crisis in Pakistan: A review of sustainable electricity options," Renewable and Sustainable Energy Reviews, Elsevier, vol. 72(C), pages 734-745.
    10. Abdul Rehman & Rasim Ozcan & Waqar Badshah & Magdalena Radulescu & Ilhan Ozturk, 2021. "Symmetric and Asymmetric Impacts of Commercial Energy Distribution from Key Sources on Economic Progress in Pakistan," Sustainability, MDPI, vol. 13(22), pages 1-22, November.
    11. Rajesh Sharma & Pradeep Kautish & Dhyani Mehta, 2024. "Determining Energy Consumption Function under Nonlinearity and Structural Break in India: An Empirical Investigation," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 22(2), pages 339-363, June.
    12. Nasir Iqbal & Saima Nawaz, 2020. "Moving Up The Energy Ladder: The Impact Of Bisp Cash Transfers On Fuel Choices," PIDE Knowledge Brief 2020:10, Pakistan Institute of Development Economics.
    13. Duan, Wenqi & Khurshid, Adnan & Nazir, Naila & Khan, Khalid & Calin, Adrian Cantemir, 2022. "From gray to green: Energy crises and the role of CPEC," Renewable Energy, Elsevier, vol. 190(C), pages 188-207.
    14. Aslam, Misbah & Ahmad, Eatzaz, 2023. "Untangling electricity demand elasticities: Insights from heterogeneous household groups in Pakistan," Energy, Elsevier, vol. 282(C).

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