Estimating the Price Elasticity of Electricity of Urban Residential Consumers in Eastern China

Abstract

Urban residential consumers represent an increasing share in electricity consumption in Eastern China, making it vital for policy makers to understand how various factors, especially price, can impact residential power usage. This paper first introduces two micro-models for estimating electricity price elasticity. Based on data from a household survey in Shanghai and Nanjing, the electricity price elasticity in these two typical regions is calculated, which is approximately -0.51, or -0.68. Finally, the paper provides insights for policy makers regarding residential electricity market regulation in Eastern China.