An empirical analysis of energy demand in Sub-Saharan Africa

The thesis presents the first comprehensive analysis of energy demand in Sub-Saharan Africa (SSA) by analysing the demand functions for both aggregated and disaggregated (by energy types) energy demand models. The main aim of the study is to explore the impact of income, price, economic structure, urbanisation and population on the demand for energy in SSA for the period 1980 to 2014. To achieve this aim, the study adopts a panel data model approach to analyse secondary data sourced from publicly available and widely used energy and economic databases. The aggregate demand model analysis reveals that income, urbanisation and energy prices are significant drivers of aggregate energy demand in the long run in SSA. The panel model was analysed using the panel cointegation technique. From the results, there is evidence that as consumers earn more, they are able to acquire more energy gadgets and appliances. Similarly, with economic growth, both new and existing firms can expand their production scale which increases the overall amount of energy consumed. The results also suggest that a rise in rural-urban migration increase the total energy consumed, as consumers move towards the use of modern energy equipment that is more accessible in urban areas. The results also indicate that, in accordance with economic theory and the law of demand, an increase in the price of energy reduces the total amount of energy consumed, though such response is found to be fairly inelastic. For the disaggregated models, the specific individual energy types analysed are: electricity, petrol, diesel, liquefied petroleum gas (LPG), kerosene and solid biomass. From the panel linear static models employed, the analysis shows that economic structure, urbanisation, population and income are all significant drivers of the demand for the energy types analysed in SSA. This suggests that as population increases, there will be an increase in demand for each energy type in the region. The same response applies to an increase in urban population and income. From the results, this study found that population is the predominant factor behind the increase in demand for the analysed energy types, with the highest elasticity. The results are in line with the theory of demand. The identified factors, their analysed impacts on the demand for energy and the reported elasticities, whilst increasing our academic knowledge of the main determinants of energy in SSA, can also help policymakers prepare evidence-based and more effective energy demand management, to meet the energy need of consumers in the region. The findings suggest the need for stringent energy conservation policies through effective energy efficiency practice in all the sixteen countries analysed, to ensure that an increase in energy use does not lead to more greenhouse gas (GHG) emission and the produced energy is well utilized. Furthermore, there is a need for increased competition through the use of independent power companies to improve energy service delivery and markets in Sub-Saharan Africa.

Grantor dc:publisher

Oxford Brookes University

Year dc:date

2017

Author dc:creator

• Kolawole, Aisha

Contributors dc:contributor

• Adesola, Sola
• De Vita, Glauco

Statement dc:rights

• All rights reserved

Language dc:language

en

DOI dc:identifier

https://doi.org/10.24384/psd9-fh55

OAI identifier oai:identifier

tle:1886b97b-4870-430a-9815-e0a2cf3ca658:d6bd9758-527a-46cd-bfe2-c433766e8fca:1