Analysis of household energy consumption in Ghana

Abstract

Household energy consumption and its related issues have received considerable attention in recent times. However, the bulk of research has focused on macro perspective using times series data and methods. Empirical research using micro level data is limited. This study therefore examines household energy consumption using household level data. The study used data from the sixth round of the Ghana Living Standards Survey to examine enegy consumption, choice and crowding-out effects of energy expenditure. The econometric approaches used in this study were the Tobit, ordinary least square (OLS), conditional mixed process, and multinomial logit regression techniques. The results of the study showed that there is a significant positive relationship between income and energy consumption. It was also observed that stock of electrical appliances has a significant influence on energy consumption. Finally, expenditure on energy was established to crowd-out allocation to food, alcohol, clothing, communication, housing and furnishing while crowding in spending on health, education, transport, recreation, hotel and miscellaneous. It is recommended that households should be encouraged to adopt energy-efficient electrical appliances. In addition, an intensive sensitisation campaign to educate households about energy conservation practices is strongly advocated.