Abstract
Within the framework of the COP21 (Conference of the Parties) agreement, Algeria submitted its Intended Nationally Determined Contribution pledging to reduce carbon emissions by at least 7% by 2030. However, it will be a difficult task to reach this target as total final energy consumption has increased 32% from 2010 to 2014, with the major energy increases being related to electricity use in the residential sector. In this context, the relationship between residential electricity consumption and income is analyzed for Algeria in the period 1970–2013, by estimating a residential electricity consumption per capita demand function which depends on GDP per capita, its squared and cubed terms, the electricity prices, and the goods and services imports. An extended Autoregressive Distributed Lag model (ARDL) was adopted to consider the different growth patterns registered in the evolution of GDP. The estimate results show that the relationships between electricity use and GDP (in per capita terms) present an inverted N-shape, with the second turning point having been reached. Therefore, promoting growth in Algeria could be convenient to reduce the electricity consumption, as a higher income level may allow the use of more efficient appliances. Additionally, renewable energies may be adequate to increase the electricity production in order to cover the increasing residential demand.
Highlights
Algeria has shown great interest in signing the 2015 Paris agreement [1]
The relationship between residential electricity use and income is analyzed for Algeria in the period 1970–2013, by estimating a residential electricity consumption per capita demand function which depends on GDP per capita, its squared and cubed terms, the electricity prices, and the goods and services imports
The energy measures included in the Algerian Intended Nationally Determined Contribution (INDC) are aimed at reducing the global consumption of energy by 9% by 2030 and at diversifying the energy mix by reaching 27% of electricity being generated from renewable energy sources [3]
Summary
Algeria has shown great interest in signing the 2015 Paris agreement [1]. On the one hand, Algeria is the third largest CO2 emitter among African countries [2] and, in 2014, total emissions amounted to147 MT CO2. Algeria is the third largest CO2 emitter among African countries [2] and, in 2014, total emissions amounted to. Algeria is especially exposed to climate change effects as the annual rainfall has been reduced in recent years by up to 30%, and its capacity to capture carbon is small due to the wide extent of the desert [3]. Algeria was one of the first developing countries to submit its Intended Nationally Determined Contribution (INDC), in which it is committed to reducing. Its total final energy consumption has increased 32% from 2010 to 2014, its major energy increases being related to electricity use in the residential sector [4].
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