The Relationship between Electricity Consumption and Economic Growth in Five ASEAN Countries, 1971–2013

Abstract

This research aimed to analyze the relationship between Electricity Consumption and Economic Growth (GDP) in 5 ASEAN Countries from 1971- 2013. This research used Secondary Data from the World Bank Development. The analysis of the data focused on Granger Causality and Error correction model analysis to see the results of the interpretation of the influence of short-term and long-term. The data used were electricity consumption and GNP of five ASEAN countries (Indonesia, Malaysia, Singapore, Thailand, Philippines) from 1971- 2013. The research concluded that in a short term relationship, electricity conservation policy through increased efficiency power supplies may avoid wasting electricity and manage electricity demand without affecting the benefits of electricity consumption in order not to adversely affect the economic growth that had been maintained very well. The research found a long-term relationship that indicated the large enough electric supply may cause the high level of economic growth and enabling technologies that may develop rapidly.