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Convergence in electricity consumption across Indian states: a disaggregated analysis

Convergence in electricity consumption across Indian states: a disaggregated analysis The purpose of this study is to examine whether the electricity consumption patterns across Indian states do converge.Design/methodology/approachThis study considers 18 Indian states spanning over the period 1970-1971 and 2014-2015, using the recently developed Phillips and Sul panel convergence technique that accounts the multiple steady states.FindingsThe results provide the following insights. First, the authors find evidence of convergence in electricity consumption among all Indian states. This suggests that electricity consumption patterns for Indian states are converging to a common steady state. Second, to provide broader insights, we further investigate the convergence in electricity consumption among user groups such as agriculture, industry, commercial, domestic and miscellaneous. The results reveal that commercial, domestic and miscellaneous groups are also converging. Third, the non-convergence patterns in agriculture and industry enable us to investigate the possibility of clubs or the multiple common steady states. The results indicate the occurrence of three clubs in case of agriculture and two clubs in case of the industry. Fourth, this study also inspects the relative speed of convergence among the user groups. The results reveal the higher speed of convergence in case of the domestic user group.Practical implicationsThe findings enable policymakers to formulate an appropriate energy policy to accommodate the future electricity demand across Indian states and prioritize low electricity consumption states so that they receive a greater share.Originality/valueThis is the first study that examines the convergence in electricity consumption across Indian states at aggregate and user groups using a new panel club convergence technique. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Energy Sector Management Emerald Publishing

Convergence in electricity consumption across Indian states: a disaggregated analysis

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
1750-6220
DOI
10.1108/ijesm-03-2019-0009
Publisher site
See Article on Publisher Site

Abstract

The purpose of this study is to examine whether the electricity consumption patterns across Indian states do converge.Design/methodology/approachThis study considers 18 Indian states spanning over the period 1970-1971 and 2014-2015, using the recently developed Phillips and Sul panel convergence technique that accounts the multiple steady states.FindingsThe results provide the following insights. First, the authors find evidence of convergence in electricity consumption among all Indian states. This suggests that electricity consumption patterns for Indian states are converging to a common steady state. Second, to provide broader insights, we further investigate the convergence in electricity consumption among user groups such as agriculture, industry, commercial, domestic and miscellaneous. The results reveal that commercial, domestic and miscellaneous groups are also converging. Third, the non-convergence patterns in agriculture and industry enable us to investigate the possibility of clubs or the multiple common steady states. The results indicate the occurrence of three clubs in case of agriculture and two clubs in case of the industry. Fourth, this study also inspects the relative speed of convergence among the user groups. The results reveal the higher speed of convergence in case of the domestic user group.Practical implicationsThe findings enable policymakers to formulate an appropriate energy policy to accommodate the future electricity demand across Indian states and prioritize low electricity consumption states so that they receive a greater share.Originality/valueThis is the first study that examines the convergence in electricity consumption across Indian states at aggregate and user groups using a new panel club convergence technique.

Journal

International Journal of Energy Sector ManagementEmerald Publishing

Published: Mar 19, 2020

Keywords: Electricity consumption; User groups; Phillips and Sul panel convergence; Indian states; Q4; R1; C23

References