An Econometric Analysis of Zambian Industrial Electricity Demand

The writer¿s purpose is twofold: to examine the electricity use in Zambiäs mining industry by focusing on own-price, cross price and index of mining production elasticities of demand, and on structural changes in demand patterns over the period 1980-2008 in order to expose any energy efficiency developments in Zambiäs mining industry. Data for Zambia on three independent and the independent variables was collected from various databases, and analysed using the Statistical Package for Social Sciences (SPSS). The long-run mining industry electricity demand equation for Zambia is estimated and found to be useful and statistically significant. Both cross-price and index of mining production elasticities are statistically significant, and own price elasticity insignificant. Diesel price have long run significant impact on mining industrial electricity demand. Developments in the efficient use of electricity in the mining industry during the period 1980-2008 were minimal, and the explanation for this lies in absence of both national policy and mine policy on energy efficiency.