The demand for energy in Greece: assessing the effects of the Community Support Framework 1994-1999

The paper estimates the demand for energy in Greece in the tradable and non-tradable sectors and for the three main types of energy, namely oil, electricity and solid fuel. Using the estimated demand functions, forecasts of the demand for energy until the year 2010 are derived by incorporating the system of demand and energy price equations into a fully-fledged annual macroeconometric model. The model is subsequently used to forecast the demand for energy and the shares of various forms under alternative assumptions about the effects of the Community Support Framework (CSF). It is found that the demand for energy will be significantly affected by the presence of externalities in the implementation of CSF that give rise to positive supply-side effects and boost growth. In the absence of supply-side externalities, total energy demand rises by 1.4% above the benchmark non-CSF scenario. With growth-inducing externalities, total demand will increase at year 2010 by 6.0% above baseline. (C) 1997 Elsevier Science B.V.