RT Journal Article
SR Electronic
T1 Energy Demand with Declining Rate Schedules: An Econometric Model for the U.S. Commercial Sector
JF Land Economics
JO Land Econ
FD University of Wisconsin Press
SP 86
OP 105
DO 10.2307/3147107
VO 79
IS 1
A1 Denton, Frank T.
A1 Mountain, Dean C.
A1 Spencer, Byron G.
YR 2003
UL http://le.uwpress.org/content/79/1/86.abstract
AB We specify and estimate a model of the demand for electricity and natural gas in commercial buildings using data from the Commercial Building Energy Consumption Survey. Although not observed, declining rate schedules are approximated by a downward sloping function fitted to billing data for individual survey units. Marginal prices (rates), temperature variables and a large number of building characteristics are incorporated into the model as explanatory variables. Demand and rate schedule equations constitute a simultaneous system, with prices and quantities jointly determined. The effects on price elasticities of using (endogenous) marginal rather than (exogenous) average prices are estimated to be quite large. (JEL Q41)