Conference name, dates, place
International Conference on Development Studies in Ethiopia, July 11-12, 2003, Addis Ababa, Ethiopia
Document Type
Paper
Presentation Date
7-2003
Abstract
This study looks into the energy demand and consumption pattern of households in selected urban areas. The analysis indicates that the use of traditional fuels dominates households' consumption pattern. However, the extent of the dominance varies across cities/towns and across income groups. A multivariate analysis of the consumption pattern reveals that the probability of consuming traditional fuels in general declines with increase in income and prices of the traditional fuels where as it increases with the increase in the prices of the modern fuels. The probability of consuming modern fuels increases with increase in income and prices of the traditional fuels and declines with an increase in modern fuel prices.
CLAD estimation of demand functions using micro data indicates that demand for all forms of energy are price elastic. Cross price relations indicate that kerosene is a substitute for both charcoal and firewood, where as electricity is a substitute for all the three. Charcoal and firewood are complements. The result that electricity is a substitute for all forms of energy gives indication that the long-run option in ensuring energy transition is to harness the huge hydro-electric generation potential of the country. All the energy sources considered were found to have income elasticities very close to one owing to the fact that energy consumption is a necessity. The other point to note is that household size has been identified as one important variable that increases demand for all forms of energy.
Owing to the fact that the consumption pattern in Addis Ababa is substantially different from others, this effect is captured by a dummy variable and the estimated coefficients indicate that the use of traditional fuels increases with the probability of being outside Addis Ababa where as the opposite holds for the use of modern fuel, emphasizing the impact of the level of urbanization on energy consumption pattern.
WMU ScholarWorks Citation
Gamtessa, Samuel Faye, "Household’s Consumption Pattern and Demand for Energy in Urban Ethiopia" (2003). International Conference on African Development Archives. 76.
https://scholarworks.wmich.edu/africancenter_icad_archive/76