Research Of Electricity Investment Based On Econometrics

ABSTRACT:Whether electricity investment scientific and rational or not, would not only affect the development of electric power enterprises even the whole electricity industry, but also affect the development of economy for the discussed areas. In order to make electricity investment scientifically, investment theory and mathematical modeling methods should be used to research electricity investment. Based on Econometric theory, the research is to find if electricity investment, electricity consumption and economy could maintain a coordinated relationship, helping to avoid the contradiction of power supply and demand,which caused by shortage or surplus of electricity investment, and to ensure the available production capacity which is produced by power investment could meet the growing needs of electricity in the future.Firstly, some fundamental conceptions of investment science, co-integration theory and the related mathematical modeling methods are introduced in detail, including Unit root test, Granger causality test, co-integration test, error correction model and vector error correction model, which are necessary for the empirical application.Secondly, with the software Eviews5.0, the data from 1980 to 2008 of China is used in analyzing the relationship among electricity investment, electricity consumption and economic growth in China. Applying Unit root test, Granger causality test, and Johansen test, electricity investment variation with single influencing factor and multiple influencing factors are discussed respectively. And long-term equilibrium model and short-term error correction model are obtained. The results demonstrated that China electricity consumption is the unidirectional Granger causality of electricity investment and a long-term co-integration relationship existed among electricity investment, electricity consumption and economic growth from 1980 to 2008, electricity investment varied with electricity consumption and economic growth in the same direction.Thirdly, multi-index system is established, with the help of clustering method,31 regions are classified into four categories, and four provinces are from each category selected as typical regions. Electricity investment co-integration analysis referred to these regions has been done. Correspondingly, comparison among them is gotten. For Guangdong, Zhejiang and Jilin Province, a long-term co-integration relationship among electricity investment, electricity consumption and economic growth exists since 1993, the driving effect of electricity consumption to power investment is increasing from developed regions to less developed regions. Nevertheless, the result of Granger causality test is quite different among these regions. For Gansu Province, its electricity investment had no co-integration relation with other variables, the shortage of power investment seriously affected electricity consumption and the growth of economy. Then difficulties in getting more funds are analyzed and some suggestions on developing financing channels are proposed.Based on the above research, we not only get to know if the electricity investment in these areas could meet electricity demand and economic development, but also we are able to predict long-term power investment by using the established equilibrium model of electricity investment co-integration, which is useful for us to make electricity investment decision.