Open Science Research Excellence

Open Science Index

Commenced in January 2007 Frequency: Monthly Edition: International Publications Count: 29416


Select areas to restrict search in scientific publication database:
9997815
Modeling Residential Electricity Consumption Function in Malaysia: Time Series Approach
Abstract:
As the Malaysian residential electricity consumption continued to increase rapidly, effective energy policies, which address factors affecting residential electricity consumption, is urgently needed. This study attempts to investigate the relationship between residential electricity consumption (EC), real disposable income (Y), price of electricity (Pe) and population (Po) in Malaysia for 1978-2011 period. Unlike previous studies on Malaysia, the current study focuses on the residential sector, a sector that is important for the contemplation of energy policy. The Phillips-Perron (P-P) unit root test is employed to infer the stationarity of each variable while the bound test is executed to determine the existence of co-integration relationship among the variables, modelled in an Autoregressive Distributed Lag (ARDL) framework. The CUSUM and CUSUM of squares tests are applied to ensure the stability of the model. The results suggest the existence of long-run equilibrium relationship and bidirectional Granger causality between EC and the macroeconomic variables. The empirical findings will help policy makers of Malaysia in developing new monitoring standards of energy consumption. As it is the major contributing factor in economic growth and CO2 emission, there is a need for more proper planning in Malaysia to attain future targets in order to cut emissions.
Digital Object Identifier (DOI):

References:

[1] M. Saatci and Y. Dumrul, "The relationship between energy consumption and economic growth: Evidence from a structural break analysis for Turkey,” Int. J. Energy Econ. Policy, vol. 3, no. 1, pp. 20–29, 2013.
[2] J. Kraft and A. Kraft, "On the relationship between energy and GNP,” J. Energy Dev., vol. 3, no. 2, pp. 401–403, 1978.
[3] A. R. F. Al-Faris, "The demand for electricity in the GCC countries,” Energy Policy, vol. 30, pp. 117–124, 2002.
[4] H. Amusa, K. Amusa, and R. Mabugu, "Aggregate demand for electricity in South Africa: An analysis using the bounds testing approach to cointegration,” Energy Policy, vol. 37, pp. 4167–4175, 2009.
[5] P. K. Adom, W. Bekoe, and S. K. K. Akoena, "Modelling aggregate domestic electricity demand in Ghana: An autoregressive distributed lag bounds cointegration approach,” Energy Policy, vol. 42, pp. 530–537, 2012.
[6] B. Atanasiu and P. Bertoldi, "Latest assessment of residential electricity consumption and efficiency trends in the European Union,” Int. J. Green Energy, vol. 7, no. 5, pp. 552–575, 2010.
[7] R. J. Cebula, "US residential electricity consumption: The effect of states’ pursuit of energy efficiency policies,” Appl. Econ. Lett., vol. 19, no. 15, pp. 1499–1503, 2012.
[8] T. Dergiades and L. Tsoulfidis, "Estimating residential demand for electricity in the United States, 1965–2006,” Energy Econ., vol. 30, pp. 2722–2730, 2008.
[9] T. Dergiades and L. Tsoulfidis, "Revisiting residential demand for electricity in Greece: New evidence from the ARDL approach to cointegration analysis,” Empir. Econ., vol. 41, pp. 511–531, 2011.
[10] M. Filippini and S. Pachauri, "Elasticities of electricity demand in urban Indian households,” Energy Policy, vol. 32, pp. 429–436, 2004.
[11] F. Halicioglu, "Residential electricity demand dynamics in Turkey,” Energy Econ., vol. 29, pp. 199–210, 2007.
[12] P. Holtedahl and F. L. Joutz, "Residential electricity demand in Taiwan,” Energy Econ., vol. 26, pp. 201–224, 2004.
[13] T. Nakajima, "The residential demand for electricity in Japan: An examination using empirical panel analysis techniques,” J. Asian Econ., vol. 21, no. 4, pp. 412–420, 2010.
[14] P. K. Narayan, R. Smyth, and A. Prasad, "Electricity consumption in G7 countries: A panel cointegration analysis of residential demand elasticities,” Energy Policy, vol. 35, pp. 4485–4494, 2007.
[15] E. Ziramba, "The demand for residential electricity in South Africa,” Energy Policy, vol. 36, pp. 3460–3466, 2008.
[16] Malaysia Energy Commission, "Malaysia energy information hub,” 2013. (Online). Available: http://meih.st.gov.my. (Accessed: 05-Jul-2013).
[17] V. G. R. Chandran, S. Sharma, and K. Madhavan, "Electricity consumption–growth nexus: The case of Malaysia,” Energy Policy, vol. 38, pp. 606–612, 2010.
[18] L. Fei, S. Dong, L. Xue, Q. Liang, and W. Yang, "Energy consumption-economic growth relationship and carbon dioxide emissions in China,” Energy Policy, vol. 39, pp. 568–574, 2011.
[19] I. Gam and J. Ben Rejeb, "How can we assess the relation between equipment, price and electricity demand in Tunisia?,” Int. J. Energy Econ. Policy, vol. 2, no. 3, pp. 159–166, 2012.
[20] B. K. Sovacool, I. Mukherjee, I. M. Drupady, and A. L. D’Agostino, "Evaluating energy security performance from 1990 to 2010 for eighteen countries,” Energy, vol. 36, pp. 5846–5853, 2011.
[21] D. I. Stern, "The role of energy in economic growth,” Ann. N. Y. Acad. Sci., vol. 1219, pp. 26–51, 2011.
[22] The World Bank, "World Development Indicators,” 2013. (Online). Available: http://data.worldbank.org/country/malaysia. (Accessed: 05-Jul-2013).
[23] Malaysia Energy Commission, "National energy balance 2010,” Putrajaya, 2012.
[24] T. H. Oh, S. Y. Pang, and S. C. Chua, "Energy policy and alternative energy in Malaysia: Issues and challenges for sustainable growth,” Renew. Sustain. Energy Rev., vol. 14, pp. 1241–1252, 2010.
[25] Tenaga Nasional Berhad, "RM20 Government Subsidy,” 2013. (Online). Available: http://www.tnb.com.my. (Accessed: 05-Jul-2013).
[26] Tenaga Nasional Berhad, "SAVE Rebate Program,” 2013. (Online). Available: http://www.tnb.com.my. (Accessed: 05-Jul-2013).
[27] R. Saidur, H. H. Masjuki, and M. Y. Jamaluddin, "An application of energy and exergy analysis in residential sector of Malaysia,” Energy Policy, vol. 35, no. 2, pp. 1050–1063, 2007.
[28] P. P. . W. Athukorala and C. Wilson, "Estimating short and long-term residential demand for electricity: New evidence from Sri Lanka,” Energy Econ., vol. 32, pp. S34–S40, 2010.
[29] H. A. Bekhet and N. S. Othman, "Assessing the elasticities of electricity consumption for rural and urban areas in Malaysia: A non-linear approach,” Int. J. Econ. Financ., vol. 3, no. 1, pp. 208–217, 2011.
[30] V. Bianco, O. Manca, and S. Nardini, "Electricity consumption forecasting in Italy using linear regression models,” Energy, vol. 34, pp. 1413–1421, 2009.
[31] G. De Vita, K. Endresen, and L. C. Hunt, "An empirical analysis of energy demand in Namibia,” Energy Policy, vol. 34, pp. 3447–3463, 2006.
[32] E. Erdogdu, "Electricity demand analysis using cointegration and ARIMA modelling: A case study of Turkey,” Energy Policy, vol. 35, pp. 1129–1146, 2007.
[33] L. M. Galindo, "Short- and long-run demand for energy in Mexico: A cointegration approach,” Energy Policy, vol. 33, pp. 1179–1185, 2005.
[34] D. R. Kamerschen and D. V. Porter, "The demand for residential, industrial and total electricity, 1973–1998,” Energy Econ., vol. 26, pp. 87–100, 2004.
[35] C. F. Tang, "Electricity consumption, income, foreign direct investment, and population in Malaysia: New evidence from multivariate framework analysis,” J. Econ. Stud., vol. 36, no. 4, pp. 371–382, 2009.
[36] H. Amarawickrama and L. Hunt, "Electricity demand for Sri Lanka: A time series analysis,” Energy, vol. 33, pp. 724–739, 2008.
[37] T. Zachariadis and N. Pashourtidou, "An empirical analysis of electricity consumption in Cyprus,” Energy Econ., vol. 29, pp. 183–198, 2007.
[38] T. Chang, W. Fang, and L. Wen, "Energy consumption, employment, output, and temporal causality: evidence from Taiwan based on cointegration and error-correction modelling techniques,” Appl. Econ., vol. 33, no. 8, pp. 1045–1056, 2001.
[39] S.-T. Chen, H.-I. Kuo, and C.-C. Chen, "The relationship between GDP and electricity consumption in 10 Asian countries,” Energy Policy, vol. 35, pp. 2611–2621, 2007.
[40] C.-Y. Ho and K. W. Siu, "A dynamic equilibrium of electricity consumption and GDP in Hong Kong: An empirical investigation,” Energy Policy, vol. 35, pp. 2507–2513, 2007.
[41] R. Morimoto and C. Hope, "The impact of electricity supply on economic growth in Sri Lanka,” Energy Econ., vol. 26, pp. 77–85, 2004.
[42] A. Shiu and P.-L. Lam, "Electricity consumption and economic growth in China,” Energy Policy, vol. 32, pp. 47–54, 2004.
[43] H. A. Bekhet and N. S. Othman, "Causality analysis among electricity consumption, consumer expenditure, gross domestic product (GDP) and foreign direct investment (FDI): Case study of Malaysia,” J. Econ. Int. Financ., vol. 3, no. 4, pp. 228–235, 2011.
[44] C. B. . Jumbe, "Cointegration and causality between electricity consumption and GDP: Empirical evidence from Malawi,” Energy Econ., vol. 26, pp. 61–68, 2004.
[45] P. K. Narayan and R. Smyth, "Electricity consumption, employment and real income in Australia evidence from multivariate Granger causality tests,” Energy Policy, vol. 33, pp. 1109–1116, 2005.
[46] Q. Hou, "The relationship between energy consumption growths and economic growth in China,” Int. J. Econ. Financ., vol. 1, no. 2, pp. 232–237, 2009.
[47] N. M. Odhiambo, "Electricity consumption and economic growth in South Africa: A trivariate causality test,” Energy Econ., vol. 31, pp. 635–640, 2009.
[48] C. F. Tang, "A re-examination of the relationship between electricity consumption and economic growth in Malaysia,” Energy Policy, vol. 36, pp. 3077–3085, 2008.
[49] S.-H. Yoo, "Electricity consumption and economic growth: Evidence from Korea,” Energy Policy, vol. 33, pp. 1627–1632, 2005.
[50] W. Oh and K. Lee, "Causal relationship between energy consumption and GDP revisited: The case of Korea 1970–1999,” Energy Econ., vol. 26, pp. 51–59, 2004.
[51] S. Paul and R. N. Bhattacharya, "Causality between energy consumption and economic growth in India: A note on conflicting results,” Energy Econ., vol. 26, pp. 977–983, 2004.
[52] Y. U. Glasure, "Energy and national income in Korea: Further evidence on the role of omitted variables,” Energy Econ., vol. 24, pp. 355–365, 2002.
[53] H.-Y. Yang, "A note on the causal relationship between energy and GDP in Taiwan,” Energy Econ., vol. 22, pp. 309–317, 2000.
[54] J. Asafu-Adjaye, "The relationship between energy consumption, energy prices and economic growth: Time series evidence from Asian developing countries,” Energy Econ., vol. 22, pp. 615–625, 2000.
[55] I. Ozturk, "A literature survey on energy–growth nexus,” Energy Policy, vol. 38, pp. 340–349, 2010.
[56] F. Jamil and E. Ahmad, "Income and price elasticities of electricity demand: Aggregate and sector-wise analyses,” Energy Policy, vol. 39, pp. 5519–5527, 2011.
[57] D. Asteriou and S. G. Hall, Applied econometrics: A modern approach, Revised ed. New York: Palgrave Macmillan, 2007.
[58] S.-H. Yoo, "The causal relationship between electricity consumption and economic growth in the ASEAN countries,” Energy Policy, vol. 34, pp. 3573–3582, 2006.
[59] B. Vogelvang, Econometrics: Theory and applications with EViews, 1st ed. Harlow: Pearson, 2005.
[60] H. A. Bekhet and A. Matar, "Co-integration and causality analysis between stock market prices and their determinates in Jordan,” Econ. Model., vol. 35, pp. 508–514, 2013.
[61] H. Lütkepohl, New introduction to multiple time series analysis. Berlin: Springer-Verlag, 2005.
[62] M. H. Pesaran, Y. Shin, and R. J. Smith, "Bounds testing approaches to the analysis of level relationships,” J. Appl. Econom., vol. 16, pp. 289–326, 2001.
[63] P. K. Narayan, "The saving and investment nexus for China: Evidence from cointegration tests,” Appl. Econ., vol. 37, no. 17, pp. 1979–1990, 2005.
[64] H. A. Bekhet and T. Yasmin, "Disclosing the Relationship among CO2 Emissions, Energy Consumption, Economic Growth and Bilateral Trade between Singapore and Malaysia: An Econometric Analysis,” Int. J. Soc. Hum. Sci. Eng., vol. 7, no. 9, pp. 321–326, 2013.
Vol:13 No:03 2019Vol:13 No:02 2019Vol:13 No:01 2019
Vol:12 No:12 2018Vol:12 No:11 2018Vol:12 No:10 2018Vol:12 No:09 2018Vol:12 No:08 2018Vol:12 No:07 2018Vol:12 No:06 2018Vol:12 No:05 2018Vol:12 No:04 2018Vol:12 No:03 2018Vol:12 No:02 2018Vol:12 No:01 2018
Vol:11 No:12 2017Vol:11 No:11 2017Vol:11 No:10 2017Vol:11 No:09 2017Vol:11 No:08 2017Vol:11 No:07 2017Vol:11 No:06 2017Vol:11 No:05 2017Vol:11 No:04 2017Vol:11 No:03 2017Vol:11 No:02 2017Vol:11 No:01 2017
Vol:10 No:12 2016Vol:10 No:11 2016Vol:10 No:10 2016Vol:10 No:09 2016Vol:10 No:08 2016Vol:10 No:07 2016Vol:10 No:06 2016Vol:10 No:05 2016Vol:10 No:04 2016Vol:10 No:03 2016Vol:10 No:02 2016Vol:10 No:01 2016
Vol:9 No:12 2015Vol:9 No:11 2015Vol:9 No:10 2015Vol:9 No:09 2015Vol:9 No:08 2015Vol:9 No:07 2015Vol:9 No:06 2015Vol:9 No:05 2015Vol:9 No:04 2015Vol:9 No:03 2015Vol:9 No:02 2015Vol:9 No:01 2015
Vol:8 No:12 2014Vol:8 No:11 2014Vol:8 No:10 2014Vol:8 No:09 2014Vol:8 No:08 2014Vol:8 No:07 2014Vol:8 No:06 2014Vol:8 No:05 2014Vol:8 No:04 2014Vol:8 No:03 2014Vol:8 No:02 2014Vol:8 No:01 2014
Vol:7 No:12 2013Vol:7 No:11 2013Vol:7 No:10 2013Vol:7 No:09 2013Vol:7 No:08 2013Vol:7 No:07 2013Vol:7 No:06 2013Vol:7 No:05 2013Vol:7 No:04 2013Vol:7 No:03 2013Vol:7 No:02 2013Vol:7 No:01 2013
Vol:6 No:12 2012Vol:6 No:11 2012Vol:6 No:10 2012Vol:6 No:09 2012Vol:6 No:08 2012Vol:6 No:07 2012Vol:6 No:06 2012Vol:6 No:05 2012Vol:6 No:04 2012Vol:6 No:03 2012Vol:6 No:02 2012Vol:6 No:01 2012
Vol:5 No:12 2011Vol:5 No:11 2011Vol:5 No:10 2011Vol:5 No:09 2011Vol:5 No:08 2011Vol:5 No:07 2011Vol:5 No:06 2011Vol:5 No:05 2011Vol:5 No:04 2011Vol:5 No:03 2011Vol:5 No:02 2011Vol:5 No:01 2011
Vol:4 No:12 2010Vol:4 No:11 2010Vol:4 No:10 2010Vol:4 No:09 2010Vol:4 No:08 2010Vol:4 No:07 2010Vol:4 No:06 2010Vol:4 No:05 2010Vol:4 No:04 2010Vol:4 No:03 2010Vol:4 No:02 2010Vol:4 No:01 2010
Vol:3 No:12 2009Vol:3 No:11 2009Vol:3 No:10 2009Vol:3 No:09 2009Vol:3 No:08 2009Vol:3 No:07 2009Vol:3 No:06 2009Vol:3 No:05 2009Vol:3 No:04 2009Vol:3 No:03 2009Vol:3 No:02 2009Vol:3 No:01 2009
Vol:2 No:12 2008Vol:2 No:11 2008Vol:2 No:10 2008Vol:2 No:09 2008Vol:2 No:08 2008Vol:2 No:07 2008Vol:2 No:06 2008Vol:2 No:05 2008Vol:2 No:04 2008Vol:2 No:03 2008Vol:2 No:02 2008Vol:2 No:01 2008
Vol:1 No:12 2007Vol:1 No:11 2007Vol:1 No:10 2007Vol:1 No:09 2007Vol:1 No:08 2007Vol:1 No:07 2007Vol:1 No:06 2007Vol:1 No:05 2007Vol:1 No:04 2007Vol:1 No:03 2007Vol:1 No:02 2007Vol:1 No:01 2007