“Electricity End-User Consumers and Electricity Consumption in Uganda”
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Date
2024-09-09
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Makerere University Business School
Abstract
Electricity consumption is essential for social as well as the economic development of nations. Uganda however is one the countries in the world with the lowest electricity consumption per capita. The electricity end users in Uganda make choices on the type of electricity tariff plan upon which to consume electricity which enables distinction of electricity consumer categories, namely Domestic, Commercial and Industrial consumers. The aim of the study is to examine the causal connection between electricity end-user consumers and the aggregate electricity consumption levels in Uganda. Time series quarterly data for the period 2008-2008 is utilized in the analysis. The study anchors on energy demand theory and the Keynesian absolute income hypothesis. Estimation of the empirical model is achieved by implementing the 2SLS and the OLS estimators but the 2SLS estimator emerged as a more efficient estimator. Estimates show that domestic and industrial consumers possess a positive and significant effect on aggregate electricity consumption levels in Uganda whereas commercial consumers have no ability to predict Uganda’s aggregate electricity consumption levels. Precisely, estimates indicated that an increase in the number of domestic electricity subscribers and an increase in the number of industrial electricity consumers by 10 in a given quarter results in a 3400 KWh and a 2400 KWh increase in aggregate electricity consumption respectively, holding other factors constant. Additionally, estimates indicate that Uganda’s GDP growth can ably forecast her aggregate electricity consumption level while tariff prices do not portray ability to predict Uganda’s aggregate electricity consumption levels. The study makes a contribution to existing literature by unveiling the electricity consumer categories that that have a significant causal influence on aggregate electricity consumption levels in Uganda. Results from this study may help to shape policy in the electricity sub-sector by prioritizing the increase of electricity access to electricity consumers who portray a significant contribution to overall or aggregate electricity consumption levels in Uganda.
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This is a master's thesis.
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Citation
Muhabwa, M. (2024) Electricity End-User Consumers and Electricity Consumption in Uganda”. (Unpublished master's dissertation). Makerere University Business School, Kampala, Uganda.