Electricity Consumption and Temperature: Evidence from Satellite Data

February 5, 2021

Preview Citation

Format: Chicago

Jiaxiong Yao. Electricity Consumption and Temperature: Evidence from Satellite Data, (USA: International Monetary Fund, 2021) accessed November 23, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Past studies on the relationship between electricity consumption and temperature have primarily focused on individual countries. Many regions are understudied as a result of data constraint. This paper studies the relationship on a global scale, overcoming the data constraint by using grid-level night light and temperature data. Mostly generated by electricity and recorded by satellites, night light has a strong linear relationship with electricity consumption and is correlated with both its extensive and intensive margins. Using night light as a proxy for electricity consumption at the grid level, we find: (1) there is a U-shaped relationship between electricity consumption and temperature; (2) the critical point of temperature for minimum electricity consumption is around 14.6°C for the world and it is higher in urban and more industrial areas; and (3) the impact of temperature on electricity consumption is persistent. Sub-Saharan African countries, while facing a large electricity deficit already, are particularly vulnerable to climate change: a 1°C increase in temperature is estimated to increase their electricity demand by 6.7% on average.

Subject: Climate change, Consumption, Electricity, Income, Population and demographics

Keywords: Climate change., Electricity access, Electricity consumption, Electricity demand, Night light, Temperature, Term E, WP

Publication Details

Pages:

38
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2021/022
Stock No:

WPIEA2021022
ISBN:

9781513568539
ISSN:

1018-5941

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