Balancing short-term costs and long-term benefits: an analysis of the impact of hydroelectric power generation on electricity prices volatility in Cameroon
Abstract This study examines the short- and long-term impacts of various factors on the volatility and price of electricity in Cameroon, including hydroelectric power generation, economic growth, energy demand, and exchange rates from 2000 to 2019. The study uses an autoregressive distributed lag mo...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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SpringerOpen
2024-02-01
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| Series: | Sustainable Energy Research |
| Subjects: | |
| Online Access: | https://doi.org/10.1186/s40807-024-00099-y |
| _version_ | 1797273790266212352 |
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| author | Etienne Bienvenu Akono Vatis Christian Kemezang |
| author_facet | Etienne Bienvenu Akono Vatis Christian Kemezang |
| author_sort | Etienne Bienvenu Akono |
| collection | DOAJ |
| description | Abstract This study examines the short- and long-term impacts of various factors on the volatility and price of electricity in Cameroon, including hydroelectric power generation, economic growth, energy demand, and exchange rates from 2000 to 2019. The study uses an autoregressive distributed lag model. The study found that increasing hydroelectric power generation has both positive and negative impacts on electricity prices in the short and long term. While increasing the share of hydropower in overall energy production results in increased variation of electricity costs in the short term, it leads to significant price reductions in the long run. The study also found that economic growth has a considerable positive impact on the variation of power prices, while energy demand has a negative but insignificant effect on price volatility in the short term. Further, the study indicates that measures, such as encouraging SME engagement in renewable energy production, could improve the participation of local enterprises in the power industry and reduce the volatility of electricity prices. On the other hand, the study suggests that exchange rates could have a negative impact on electricity prices in the short term, but depreciation of the local currency could lower fuel costs and improve the availability of power. Overall, the study provides insights that can inform policymakers, energy regulators, and investors in making decisions that contribute to the efficient and sustainable development of Cameroon's electricity market. The study also highlights the need to prioritize power generation to stimulate economic growth and private investment while promoting renewable energy production. |
| first_indexed | 2024-03-07T14:49:15Z |
| format | Article |
| id | doaj.art-103149feddf3421eb2421e6b81a7d463 |
| institution | Directory Open Access Journal |
| issn | 2731-9237 |
| language | English |
| last_indexed | 2024-03-07T14:49:15Z |
| publishDate | 2024-02-01 |
| publisher | SpringerOpen |
| record_format | Article |
| series | Sustainable Energy Research |
| spelling | doaj.art-103149feddf3421eb2421e6b81a7d4632024-03-05T19:48:21ZengSpringerOpenSustainable Energy Research2731-92372024-02-0111111410.1186/s40807-024-00099-yBalancing short-term costs and long-term benefits: an analysis of the impact of hydroelectric power generation on electricity prices volatility in CameroonEtienne Bienvenu Akono0Vatis Christian Kemezang1Faculty of Economics and Applied Management, University of DoualaFaculty of Economics and Applied Management, University of DoualaAbstract This study examines the short- and long-term impacts of various factors on the volatility and price of electricity in Cameroon, including hydroelectric power generation, economic growth, energy demand, and exchange rates from 2000 to 2019. The study uses an autoregressive distributed lag model. The study found that increasing hydroelectric power generation has both positive and negative impacts on electricity prices in the short and long term. While increasing the share of hydropower in overall energy production results in increased variation of electricity costs in the short term, it leads to significant price reductions in the long run. The study also found that economic growth has a considerable positive impact on the variation of power prices, while energy demand has a negative but insignificant effect on price volatility in the short term. Further, the study indicates that measures, such as encouraging SME engagement in renewable energy production, could improve the participation of local enterprises in the power industry and reduce the volatility of electricity prices. On the other hand, the study suggests that exchange rates could have a negative impact on electricity prices in the short term, but depreciation of the local currency could lower fuel costs and improve the availability of power. Overall, the study provides insights that can inform policymakers, energy regulators, and investors in making decisions that contribute to the efficient and sustainable development of Cameroon's electricity market. The study also highlights the need to prioritize power generation to stimulate economic growth and private investment while promoting renewable energy production.https://doi.org/10.1186/s40807-024-00099-yVolatilityElectricity priceHydroelectric power generationEconomic growthEnergy demandExchange rates |
| spellingShingle | Etienne Bienvenu Akono Vatis Christian Kemezang Balancing short-term costs and long-term benefits: an analysis of the impact of hydroelectric power generation on electricity prices volatility in Cameroon Sustainable Energy Research Volatility Electricity price Hydroelectric power generation Economic growth Energy demand Exchange rates |
| title | Balancing short-term costs and long-term benefits: an analysis of the impact of hydroelectric power generation on electricity prices volatility in Cameroon |
| title_full | Balancing short-term costs and long-term benefits: an analysis of the impact of hydroelectric power generation on electricity prices volatility in Cameroon |
| title_fullStr | Balancing short-term costs and long-term benefits: an analysis of the impact of hydroelectric power generation on electricity prices volatility in Cameroon |
| title_full_unstemmed | Balancing short-term costs and long-term benefits: an analysis of the impact of hydroelectric power generation on electricity prices volatility in Cameroon |
| title_short | Balancing short-term costs and long-term benefits: an analysis of the impact of hydroelectric power generation on electricity prices volatility in Cameroon |
| title_sort | balancing short term costs and long term benefits an analysis of the impact of hydroelectric power generation on electricity prices volatility in cameroon |
| topic | Volatility Electricity price Hydroelectric power generation Economic growth Energy demand Exchange rates |
| url | https://doi.org/10.1186/s40807-024-00099-y |
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