Abstract:
The energy intensity in Pakistan has increased during 1990-2013. Examining the responsible issues for variations in energy consumption is significant for planning and policy context. In this paper, we analyze the impacts of variations in energy prices on energy intensity. To provide estimates of energy price elasticities, we used time series data. Empirical results indicated that the price elasticities of energy were negative that means greater prices of energy lead to the reduction in energy intensities. Sectoral regulation and transfer of technology also drove the decline in energy intensity. Although increasing energy prices to enhance efficiency of energy consumption looks to be an effective policy tool, other policy implications concerned with prices of energy, such as fuel poverty and energy supply security, must also be measured.
