El Paso residential electricty demand

David Ronald Macias, University of Texas at El Paso


This study utilizes a dynamic error correction model to analyze the demand for residential electricity in El Paso County, Texas. Annual data is provided by El Paso Electric Company covering the period from 1977 to 2011. This study reports negative income elasticities for residential electricity demand and indicates that electricity is treated as an inferior good in El Paso County. The negative income elasticity result runs counter to many earlier studies, although recent empirical evidence indicates that residential electricity is also treated as an inferior good in the Seattle service territory. Negative income elasticities are an interesting result, and may allow electric utilities to utilize existing generating capacity to sufficiently provide power to the service territory, even if the economy continues to expand. Further examination of electricity consumption behavior at the regional level is warranted. This study reports that in the long run, per capita residential electricity usage declines by 0.36 percent for every 1 percent increase in real per capita income. ^

Subject Area

Business Administration, Marketing|Economics, Finance

Recommended Citation

Macias, David Ronald, "El Paso residential electricty demand" (2013). ETD Collection for University of Texas, El Paso. AAI1539963.