Econometric Modelling Analysis of Climate Change Impacts on Electricity Demand

• Main Authors: Chia-Sheng Hsu, 許家勝
• Other Authors: Chi-Chung Chen
• Format: Others
• Language: en_US
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/61004190668940666350

博士 === 國立中興大學 === 應用經濟學系所 === 104 === This dissertation discusses the issue of the relationship between climate change and electricity consumption, and the three essays in this thesis describes for the effects of electricity industry deregulation on CO_2 emissions for 25 OECD countries, the effects of climate change on electricity demand in Taiwan, and the non-linear relationship between electricity consumption and temperature in Taiwan, respectively. First, this study evaluates the effects of different deregulation measures on electricity consumption and CO_2 emissions by using a panel data of 25 OCED countries from 1980 to 2010. To achieve the goals, three empirical steps are estimated by pooled mean group (PMG) in this study, respectively. (1) The first step is estimating the long-run relationship between electricity consumption and CO_2 emission. (2) The second step is identifying the long-run relationship between electricity price and consumption. (3) The third step is evaluating the effects of different deregulation measures on electricity consumption and CO_2 emissions through their long-run effects on electricity prices. Three main findings can be drawn from our empirical results: (1) the deregulation of market entry for electricity industry will reduce electricity prices and thus lead to increases in electricity consumptions and CO_2 emissions in the long run; (2) the unbundling of electricity industry will cause electricity prices to increase and thus reduce electricity consumptions and CO_2 emissions in the long run; (3) the privatization of electricity industry tends to reduce electricity prices and thus will increase electricity consumptions and CO_2 emissions in the long run. Based on our results, it is clear that regulatory reforms can improve the efficiency of the electricity market, however, it is also possible that regulatory reforms will cause electricity consumptions and CO_2 emissions to increase in the long-run. Subsequently, in order to assess the future effects of climate change on Taiwan’s electricity demand, this study respectively estimates Taiwan’s electricity demand and peak electricity demand using the annually data from 1975 to 2012, then corporates the estimated results with the future simulations of climate change in Taiwan provided by Taiwan Climate Change Projection and Information Platform (TCCIP) to forecast the future Taiwan’s electricity demand and peak electricity demand until 2050 under different climate scenarios. The estimated results show that there will be the largest rising of per capita electricity demand and per capita peak electricity demand in 2050 under the climate scenario RCP 8.5. Taiwan’s per capita electricity demand will reach 24,134 kWh in 2050, and Taiwan’s per capita peak electricity demand will reach 55,325 MW in 2050. This result implies that if the global warming is continuous in the future, it will make the rising of Taiwan’s future electricity demand. In addition, if Taiwan’s government establishes new power supply as the report of long-term planning of power expansion 2013, there will be the dangerous of electricity shortage in 2022. Finally, this study builds non-linear models to analysis the effects of temperature on electricity consumption in Taiwan with smooth transition regression (STR) model using monthly time-series data from 1983 to 2012. The empirical results indicate that there is non-linear relationship between electricity consumption and temperature in Taiwan, furthermore, the six estimated threshold temperatures are all between 25.364℃ and 27.156℃, and the average of threshold temperatures is 26.384℃. It implies that Taiwan’s electricity consumption will be non-linear growth if air temperature is higher than threshold temperature. However, the estimated threshold temperature is policy implications for Taiwan’s policy makers, meaning threshold temperature in this study could be a reference for framing policy of managing electricity demand in Taiwan.