Electricity Demand in South Africa: Is it Asymmetric?

13 Pages Posted: 27 Sep 2017

See all articles by Rangan Gupta

Rangan Gupta

University of Pretoria - Department of Economics

Roula Inglesi-Lotz

University of Pretoria

John Weirstrastrass Muteba Mwamba

University of Johannesburg

Date Written: September 2017

Abstract

The electricity demand in South Africa has experienced vast changes both from a policy point of view and due to the country's great industrialisation and urbanisation. The literature dealing with the South African electricity case, to date, has not taken into account these changes and their effect to the symmetric behaviour of the residential and industrial electricity consumers. Hence, this paper aims at examining the asymmetric behaviour of the annual South African electricity demand (total, residential and non‐residential) for the period 1960–2012. To do so, three different tests were used: the entropy test proposed by Racine and Maasoumi (2007. Journal of Econometrics 138, 2, 547; 2008. Econometric Reviews 28, 246), the conditional symmetry test proposed by Bai and Ng (2001. Journal of Econometrics 103, 225) and the Triples test proposed by Randles et al. (1980. Journal of the American Statistical Association 75, 168). The findings showed that there is weak evidence of asymmetry, given that the null hypothesis of symmetry can only be rejected at 10 per cent level of significance. Hence, econometric models examining the South African electricity demand during the same period are credible in their assumption of a linear data generating process.

Suggested Citation

Gupta, Rangan and Inglesi-Lotz, Roula and Muteba Mwamba, John Weirstrastrass, Electricity Demand in South Africa: Is it Asymmetric? (September 2017). OPEC Energy Review, Vol. 41, Issue 3, pp. 226-238, 2017, Available at SSRN: https://ssrn.com/abstract=3043519 or http://dx.doi.org/10.1111/opec.12103

Rangan Gupta (Contact Author)

University of Pretoria - Department of Economics ( email )

Lynnwood Road
Hillcrest
Pretoria, 0002
South Africa

Roula Inglesi-Lotz

University of Pretoria ( email )

Physical Address Economic and Management Sciences
Pretoria, Gauteng 0002
South Africa

John Weirstrastrass Muteba Mwamba

University of Johannesburg ( email )

Department of Economics and Econometrics
Auckland Park
Johannesburg, Gauteng 2006
South Africa

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