How Population Age Distribution Affects Future Electricity Demand in Korea: Applying Population Polynomial Function

Abstract

Mounting evidence shows that economic and climate variables such as income, energy price, and temperature impact energy demand. We examined another variable, population age distribution, which has rarely been considered, that could affect energy demand. We employ population polynomials to account for the impact of population age distribution on residential electricity consumption in Korea. Using panel data from 1990 to 2016, we verify that populations aged 20~44, and those over 60, raise residential electricity consumption. We additionally evaluate the impact of population age distribution in forecasting future electricity consumption and conclude that age distribution effects dominate total population growth effects.