Journal
ENERGY SOURCES PART B-ECONOMICS PLANNING AND POLICY
Volume 15, Issue 7-9, Pages 436-451Publisher
TAYLOR & FRANCIS INC
DOI: 10.1080/15567249.2020.1837999
Keywords
Electricity consumption; unit root; breaks
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This paper examines the stationary properties of the electricity consumption of five main sectors (residential, public services, industrial, agricultural, and street lighting) in Iran over the period 1967-2017. To analyze the data, we apply the Lagrange Multiplier (LM) and GARCH-based unit root tests with structural breaks. The results of our study provide strong evidence that electricity consumption is stationary in the industrial, residential and street lighting sectors; thus, sharp shocks have transitory effects on electricity consumption, implying that consumption trends in these sectors will ultimately return to their long-run equilibrium. However, the time series of electricity consumption for the agricultural and public services sectors contain a unit root, and thus shocks to their electricity consumption are permanent. The foregoing findings can help policymakers in each sector to design efficient electricity management policies.
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