PRICE ELASTICITY IN ELECTRIC-POWER DEMAND FORECASTING

摘要

Despite recent unprecedented increases in electricity prices, many private groups as well as some federal agencies still pro¬ject that growth of electric-power demand will continue in the future as it has in the past. These projections implicitly assume that the price elasticity of the demand for electric power is at or near zero. However, recent econometric studies of electric-power demand indicate that the price elasticity of demand is far from being zero and, assuming continued increases in electricity prices, will significantly reduce the future growth rate of electricity. This report provides a brief survey of price-elasticity studies of U.S. electric power demand and discusses some possible implications for long-range planning decisions in the electric utilities industry.