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Electricity saving in China: Information beats price

Energy Policy 94, 1–9 (2016)

Residential electricity demand is expected to grow rapidly in rural China, mainly due to increased appliance ownership. The ownership rate of colour televisions increased from 4.7% in 1990 to 116.9% in 2012, while the ownership rates of washing machines and refrigerators changed from 9.1% and 1.2% to 67.2% and 67.3%, respectively, over the same period. Due to such changes, 400 million people living in rural areas will increase their electricity consumption, reaching 2,129 TWh per year by 2030, but little is known about the potential for households to save electricity. Yihua Yu and Jin Guo from the Renmin University of China fill this gap by examining the determinants for saving electricity from 3,404 rural households in China. Rural households are generally found to be efficient in their consumption habits and scarcely affected by electricity price or energy efficiency labelling, whereas information supplied to the consumer about consumption is found to play a significant role.


By using a stochastic frontier model, the researchers were able to decompose residential electricity consumption into two groups: irreducible consumption and consumption slack. Their analysis shows that the presence of alternative energy sources to electricity, and the thrifty behaviour of consumers due to the supply scarcity, makes rural demand respond weakly to price. Therefore, price-reforms policy, planned to curb future energy consumption, might have limited impact and should be accompanied by fast information feedback (detailed energy bills, self-reading meters and home displays) that, instead, tends to promote energy conservation.


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Rubino, A. Electricity saving in China: Information beats price. Nat Energy 1, 16082 (2016).

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