Analysis of the factors affecting demand for energy in Tanzania: a case of electricity

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University of Dar es Salaam
This study attempted to analyze the factors affecting demand for energy in Tanzania. Using demand for electricity as case of investigation, the study employed cointegrated property of time series approach covers the period from 1985 to 2015, estimate the long run and short run models to understand the relationship between quantity of electricity demanded as dependent variable and price of electricity, income, prices of substitute i.e. charcoal, petrol and diesel, income, population and temperature as independent variables. The study found that in the short run model, income, and price of charcoal as a substitute were significant determinants of electricity demand in Tanzania, while price of petrol, diesel, population and temperature found to be insignificant factors for electricity demand in Tanzania. Furthermore, in the long run the study found that income, price of electricity and price of petrol to be significant determinants of electricity demand in Tanzania, whereas price of charcoal, temperature, price of diesel found to be insignificant in determining demand for electricity in Tanzania. Moreover, only income found to be significant in both models. The study recommends for expanding generation capacity from which increasing demand will be met to satisfy the community whose income level is significantly raising; to undertake strong regulation of the price of substitutes especially petrol and charcoal since their increase significantly affects electricity demand. Furthermore, the study recommends for the use of advanced technology in electricity generation, this reduces generation costs hence declining electricity prices. Moreover, the study suggested for developing a strong database for time series analysis since current available data are subjected to the structural breaks which may affect research results.
Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class mark (THS EAF HD9685.T34J67)
Electric power consumption, Tanzania
Joseph, A. (2017) Analysis of the factors affecting demand for energy in Tanzania: a case of electricity. Master dissertation, University of Dar es Salaam. Dar es Salaam.