Document Type

Journal Article

Department/Unit

Department of Economics

Title

Residential outage cost estimation: Hong Kong

Language

English

Abstract

Hong Kong has almost perfect electricity reliability, the result of substantial investments ultimately financed by electricity consumers who may be willing to accept lower reliability in exchange for lower bills. But consumers with high outage costs are likely to reject the reliability reduction. Our ordered-logit regression analysis of the responses by 1876 households to a telephone survey conducted in June 2013 indicates that Hong Kong residents exhibit a statistically-significant preference for their existing service reliability and rate. Moreover, the average residential cost estimate for a 1-h outage is US$45 (HK$350), topping the estimates reported in 10 of the 11 studies published in the last 10 years. The policy implication is that absent additional compelling evidence, Hong Kong should not reduce its service reliability. © 2014 Elsevier Ltd.

Keywords

Contingent valuation survey, Electricity reliability in Hong Kong, Residential outage cost estimation

Publication Date

2014

Source Publication Title

Energy Policy

Volume

72

Start Page

204

End Page

210

Publisher

Elsevier

DOI

10.1016/j.enpol.2014.05.002

Link to Publisher's Edition

http://dx.doi.org/10.1016/j.enpol.2014.05.002

ISSN (print)

03014215

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