The demand for fossil fuels by electric utilities in the United States

✍ Scribed by Noel D. Uri

• Publisher: Elsevier Science
• Year: 1978
• Weight: 528 KB
• Volume: 18
• Category: Article
• ISSN: 0013-7480
• DOI: 10.1016/0013-7480(78)90077-3

✦ Synopsis

There exists the possibility of interfuel substitution in the generation of electrical energy. The responsiveness of the demand for various fossil fuels by electric utilities, given this economic fact, is investigated.

Using aggregate time series data. the results indicate that the responsiveness of the demand for coal, oil, and natural gas by electric utilities to relative price changes is significant. As expected, the demand for fossil fuel increases as the level of generation expands, with the impact being proportionally spread over the fossil fuels. A most interesting result is the negative response of the demand for natural gas by electric utilities to changes in weather conditions.

The probable reason for this is that electric utilities, based on current regulatory practices, are among the first to be curtailed should any supply short-fall occur.

Fossil fuels Electrical energy

Interfuel substitution Fuel demand Generation of electrical energy.