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Modeling the electricity tariff of households in Iran's provinces to reduce subsidies in the electricity sector
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Zeinolabedin Sadeghi *   , Vahid Satari , Fatemeh Ashrafganjuei |
| Associate Professor in Department of Economics, Shahid Bahonar University of Kerman, Kerman, Iran |
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Abstract: (5 Views) |
The electricity industry is a vital component of every country, with direct impacts on economic development, national security, and quality of life. In many countries, the electricity industry operates as a natural or quasi-monopoly, and electricity tariffs are regulated by the government.
The primary objective of this study was to model electricity tariffs for the residential sector in order to reduce subsidies in Iran's electricity sector.
The research population consisted of all consumers in the electricity industry, with the statistical sample focusing on residential consumers from 2001 to 2020 in Iran.
The average domestic subsidy amounts to $40 million. The trend of changes following the implementation of subsidy targeting has shown a decline. During the economic boom years of the 2000s, electricity consumption was higher, while consumption decreased during economic downturns. The total subsidy paid to households from 2001 to 2020 amounted to $804.8 million, with an average subsidy payment of $40.2 million and a standard deviation of 24.8. The lowest subsidy was observed in South Khorasan province, while Tehran had the highest subsidy amount.
If the policy objective is to enhance economic growth in low-income areas, it is necessary to promote subsidy equity by increasing the allocation to less privileged regions.
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Article number: 4 |
| Keywords: Electricity Tariff, Residential Sector, Electricity Subsidy |
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Full-Text [PDF 814 kb]
(1 Downloads)
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Type of Study: Applicable |
Subject:
Special
Received: 2023/06/15 | Accepted: 2023/11/12 | Published: 2026/01/1
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