Impact of Climate Change on Electricity Consumption in Pakistan: An ARDL Approach

Abstract

Numerous communities worldwide may be impacted by climate change, which could have major repercussions. One of the nations that has been most negatively impacted by climate change is Pakistan. Every economic sector has been impacted by these climate changes, but the energy sector has been particularly hard hit.  In this background, the aim of this study is to find the impact of climate change on electricity consumption, for this study we have annually data of Pakistan from 1971-2017.  The project reviews the trend of climate variation for the last few decades. For estimation, the data have been taken from World Development Indicators (WDI), Water and Power Development Authority (WAPDA) and Climate Knowledge Portal World Bank Group. By using ARDL model, and taking data on annual basis, the nexuses between dependent and independent variables has been found. The study revealed significant results and recognized that climate has a substantial impact on nation’s energy demand. According to the results it is suggested that the government should take measures to overcome the crises and make strategic policies which can turn the crises into opportunities for bringing around structural changes in long run in the economy and in society.

Key words: Greenhouse Gases, Carbon Dioxide, WAPDA, ARDL