Energy Demand in Ghana: A disaggregated Analysis

Abstract

This paper presents a comprehensive analysis of energy demand in Ghana by estimating demand functions for key disaggregated energy components including gasoline, diesel, liquefied petroleum gas (LPG), kerosene, biomass, residual fuel oil (RFO) and electricity. Our results show that energy prices, income, urbanization and economic structure are significant demand drivers for the different energy types in Ghana with varying estimated elasticities. Further, there is evidence of high degree of inter-fuel substitution in energy demand in Ghana, particularly from gasoline, diesel and kerosene towards LPG consumption. We recommend, among different policy options, a customization of energy price subsidization policies, especially on LPG, to reduce the unintended beneficiary dilemma or spillover effect of current government policy. Other policies such as intensification of energy conservation programs and market entry of independent power trading companies to enhance energy service delivery through competition are also discussed.

Keywords

Energy; Ghana; Disaggregated; Elasticities

Published in

Renewable and Sustainable Energy Reviews
2016, volume: 53, pages: 924-935

SLU Authors

• Tei Mensah, Justice

  • Department of Economics, Swedish University of Agricultural Sciences
    

• Marbuah, George

  • Department of Economics, Swedish University of Agricultural Sciences
    

UKÄ Subject classification

Economics

Publication identifier

• DOI: https://doi.org/10.1016/j.rser.2015.09.035

Permanent link to this page (URI)

https://res.slu.se/id/publ/68669