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POLICY IMPACTS ON AGRICULTURAL IRRIGATION ELECTRICITY DEMAND IN THE COLUMBIA BASIN 1
Author(s) -
Martin Michael,
Cox Linda,
Nakamoto Stuart,
Halloran John
Publication year - 1990
Publication title -
jawra journal of the american water resources association
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.957
H-Index - 105
eISSN - 1752-1688
pISSN - 1093-474X
DOI - 10.1111/j.1752-1688.1990.tb01348.x
Subject(s) - price elasticity of demand , electricity , irrigation , revenue , agricultural economics , natural resource economics , agriculture , electricity demand , electricity price , economics , business , electricity generation , water resource management , environmental science , microeconomics , power (physics) , engineering , finance , geography , ecology , electrical engineering , biology , physics , archaeology , quantum mechanics
Accurately estimating the price elasticity of demand for irrigation electricity is important to major electricity suppliers such as the Bonneville Power Administration (BPA) of the Pacific Northwest. The BPA has a revenue maximization objective, and the elasticity of demand is central to its rate setting process. Several studies have attempted to estimate demand for irrigation electricity, but none has explicitly included federal agricultural policy and program variables. Tins paper discusses how agricultural programs may influence farmers irrigation decisions and thus their demand for irrigation electricity. It suggests that existing programs serve to make farmers more responsive to electricity rate increases than would otherwise be the case. Thus, studies that fail to include them may underestimate the responsiveness of farmers to electricity rate increases.