Industrial electricity demand and energy efficiency policy : the case of the Swedish mining industry

• The purpose of this paper is to analyze long-run electricity demand behavior in the Swedish mining industry with special emphasis on the impact of energy prices and private research and development (R & D) on electricity use. Methodologically, we estimate a generalized Leontief variable cost function using a panel data set of nine mining operations over the time period 1990-2005. Since the lower boundary of a set of short-run cost functions confines the long-run cost function, we can compute the long-run own- and cross-price elasticities of electricity demand. The empirical results indicate that long-run electricity demand in the mining industry is sensitive to changes in the own price, and already in a baseline setting Swedish mining companies tend to allocate significant efforts towards improving energy efficiency, in part through private R & D. From a policy perspective, the results imply that taxes (and tax exemptions) on electricity can have significant long-run impacts on electricity use. Moreover, future evaluations of so-called voluntary energy efficiency programs must increasingly recognize the already existing incentives to reduce energy use in energy-intensive industries

Ämnesord

SAMHÄLLSVETENSKAP  -- Ekonomi och näringsliv -- Nationalekonomi (hsv//swe)

SOCIAL SCIENCES  -- Economics and Business -- Economics (hsv//eng)

Nyckelord

Economics

Nationalekonomi

Framtidens gruvor (FOI)

Future mining (AERI)

Förnybar energi (FOI)

Renewable energy (AERI)

Publikations- och innehållstyp

ref (ämneskategori)

art (ämneskategori)