Alterations of demand levels in electricity markets can bring substantial shifts in their production structure, costs, and level of emissions. Nevertheless, the electricity sector is not the only one affected as these changes can create significant repercussions in other sectors and, consequently, in the whole economy. In this paper, the indirect effects of reduction in household demand for electricity were evaluated for the Spanish market. A multisectoral static computable general equilibrium was employed to achieve this objective. The results clearly point out the importance of assessing other sectors behavior when valuing the consequences of fomenting demand response policies, especially when dealing with emission objectives.
Keywords: Computable General Equilibrium (CGE), Emissions, Electricity Demand Response
V Congreso de la Asociación Española para la Economía Energética (AEEE), Vigo, España, 21-22 Enero 2010
Published: January 2010.