Thesis Public Defense | VNP27 - Phạm Lê Hữu Vĩnh

Socio-demographic determinants of household electricity consumption in Vietnam

Student: Phạm Lê Hữu Vĩnh, VNP-27

Supervisor: Dr. Võ Hồng Đức

Abstract:

Electricity is one of the most important types of secondary energy sources today, with the household sector accounting for a significant share of the whole world’s consumption. Climate change, fossil fuel depletion, and the current energy crisis demonstrate the urgency of each country’s policy to prepare for a period of transition to new clean power generation sources and to withstand external energy supply shocks, especially in developing countries. Traditional sources of energy are important inputs for the electric generation industry in many
developing countries. However, with the current worldwide trend of environmentally friendly policies, developing countries will have to accelerate their adaptation to this transition. Therefore, policies that promote electricity saving and efficient use of electricity are essential
in the current context.

Vietnam, a developing country with the goal of becoming Asia’s new tiger, has taken energy security as one of the government’s top policy goals. In order to reach the goal, energy conservation policies aimed at the household sector plays an important role. To make appropriate and effective policies in the context of Vietnam, it is necessary to understand the characteristics of households electricity demand.

This study is conducted to achieve the following three objectives. First,  understanding the role of some of the most important socio- demographic factors that influence how households consume electricity. Second, studying the economies of scale in electricity consumption of Vietnamese households. Third, examining the degree of inequality in electricity consumption between different income groups in order to improve the current policy interventions on energy saving and inequality.

The results seem attractive. First, the three main factors of income, level of education and number of household members, along with other demographic factors, have been shown to have a significant impact on household electricity consumption behaviour. Furthermore, this study also shows the reverse causality between income and electricity consumption by applying the Three-Stages Least Squares (3SLS) approach. Second, there are economies of scale in electricity consumption depending on household size in Vietnam in 2012 and 2020. Third, the study has revealed a deep inequality in electricity consumption between different income groups, thereby highlighting the need for policy interventions to reduce energy inequality and the goal of energy security to reach.

Keywords: Vietnam, Households, Electricity consumption, Socio-demographic determinants