Analysis of technological progress and input prices on electricity consumption: Evidence from China

This paper establishes a translog cost function model with productivity growth equations to study the influence of technological progress and price changes on electricity production factors and consumption. Within a unified analytic framework, regression is applied to the panel data for seven regions in China during the period 1997 to 2013. The functions of production costs on factor substitution are analyzed based on the regression. The influence of electricity price and technological progress on electricity productivity and the rebound effect of electricity are discussed. Electricity price can significantly and positively influence electricity productivity (expressed by the total value of output consumed by unit electricity); however, the stimulation of technological progress is not notable. The rebound effect of electricity computed based on an electricity price breakdown showed that values of the rebound effect in Southwestern China and Central China were higher than 100% while annual average values of the rebound effect in Northeastern China and Southern China were -60.39% and -81.47%, respectively. The area with the lowest annual average value for the rebound effect was Northwestern China at 14.96%. (C) 2018 Elsevier Ltd. All rights reserved.