Impact of climate change on sectoral electricity demand in Turkey

This paper analyzes the impact of climate change on Turkey’s residential, industrial and commercial electricity demand by applying the Structural Time Series Model. The model consists of explanatory variables and uses annual time series data for the period from 1980 to 2017. The variables included are electricity price, income per capita, urbanization rate, manufacturing added value, population-weighted cooling degree days (as a climate variable) and, finally, stochastic Underlying Energy Demand Trend. The effect of cooling degree days on the residential, industrial and commercial electricity demand is found to be significantly elastic. Moreover, residential, industrial and commercial electricity demands in 2031 are expected to increase considerably, and at different ratios, depending on the chosen climate change scenario. The findings of this study are significant for efforts to establish regulations to shape energy security policies in the presence of climate change.