Relation between electricity consumption and economic growth in Karnataka, India: An aggregate and sector-wise analysis

Title

Relation between electricity consumption and economic growth in Karnataka, India: An aggregate and sector-wise analysis

Creator

Rajkumari L.

Description

Karnataka is a highly progressive and rapidly growing state in India, with huge potential for industrial growth, however, it grapples with power deficits and other problems in electricity sector, which make it a good case study for Indian electricity sector. Given the importance of electricity in the urbanisation and growth process, the paper analyses the electricity consumption trend in Karnataka, examine its causality with economic growth at aggregate and sectoral levels using Granger causality test, and forecast the future electricity consumption applying Holt-Winters smoothening (no seasonality) technique. The general trend reflects higher consumption by the agricultural consumers, compared to the revenue-generating 'Industries' and 'Commercial' categories, mainly due to the policy of de-metering and providing 'free' power to agricultural consumers since late 1980s. The Granger causality tests reveal that there is no causality relation (neutrality hypothesis) between electricity consumption and economic growth in Karnataka, for total, agricultural and industrial consumption. This basically stems from the inaccurate measurements of agricultural consumption, higher dependence on captive generation, and poor quality grid supply. Finally, electricity consumption is predicted to be around 69,347 GW h by 2019?20. Future policies should focus on universal metering, reducing cross-subsidization, supplying good quality and reliable power to all sectors, and economical planning of resource-mix to achieve adequate, productive and efficient electricity consumption. 2020 Elsevier Inc.

Source

Electricity Journal, Vol-33, No. 5

Date

2020-01-01

Publisher

Elsevier Inc.

Subject

Cross-subsidization; Economic growth; Electricity consumption; Granger causality; Holt-winter smoothening method; Karnataka, India; Per capita consumption

Coverage

Rajkumari L., Christ (deemed to be University), Bangalore, 560029, India

Rights

Restricted Access

Relation

ISSN: 10406190; CODEN: ELEJE

Format

Online

Language

English

Type

Article

Identifier

https://doi.org/10.1016/j.tej.2020.106768

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