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Unveiling the factors affecting final electricity consumption: does the regional component matter?

Djula Borozan (Faculty of Economics in Osijek Josip Juraj Strossmayer, University of Osijek, Osijek, Croatia)
Dubravka Pekanov Starcevic (Faculty of Economics in Osijek Josip Juraj Strossmayer, University of Osijek, Osijek, Croatia)

International Journal of Energy Sector Management

ISSN: 1750-6220

Article publication date: 29 January 2018

Issue publication date: 4 May 2018

225

Abstract

Purpose

The purpose of this paper is to explore the developments in final electricity consumption, estimate the portions of changes that can be attributed to national, sectoral or regional factors, and to investigate determinants of the regional component (RC) in Croatia at the subnational level in the period 2001-2013.

Design/methodology/approach

In the first stage, the dynamic shift-share method is used to decompose final electricity consumption, and then, in the second stage, the panel population-averaged logit model is conducted to find the main determinants of the extracted RC.

Findings

The results show that both the sectoral factor and the regional factor are responsible for an increase in electricity consumption over the period considered, whereby the regional specificities had a larger impact in general. Thereby, the most developed regions, including the tourism-oriented ones, exhibited the largest average increase in electricity consumption mainly due to positive effects of the regional-specific factors, while the negative effects of these factors were mainly responsible for low average rates of changes in electricity consumption in less developed regions.

Practical implications

The results suggest that regional-specific energy conservation programs might be more effective in improving energy efficiency than the sector-oriented ones, as well as that socio-economic and contextual determinants matter when it comes to the probability of having a positive regional effect on the electricity consumption rate.

Originality/value

The paper investigated the determinants of the extracted RC which has not yet been addressed in the energy economics literature.

Keywords

Acknowledgements

This work was supported by the Croatian Science Foundation under Grant number IP-2013-11-2203.

Citation

Borozan, D. and Pekanov Starcevic, D. (2018), "Unveiling the factors affecting final electricity consumption: does the regional component matter?", International Journal of Energy Sector Management, Vol. 12 No. 2, pp. 202-220. https://doi.org/10.1108/IJESM-10-2017-0011

Publisher

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Emerald Publishing Limited

Copyright © 2018, Emerald Publishing Limited

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