The price elasticity of residential district heating demand: New evidence from a dynamic panel approach

We estimate the price elasticity of residential district heating demand in Denmark using Blundell–Bond two-step generalized method moments (GMM) estimator and a sample 152,913 observations covering period 2015 to 2019. Moreover, we analyze heterogeneity response increases among various household groups investigate distributional consequences policies that increase heating. To this end, measure effects on bills, consumption, emissions. find short-run −0.530 long-run −0.638. Higher consumption levels are associated with dwelling age, size, homeownership, income, number members, whether households receive allowances. significant evidence varies across groups: Low-income households, intensive consumers, single older smaller dwellings more responsive changes than their respective counterparts. also demonstrate 10% would expenditures high-income low-income by 7.18% 1.16% (ceteris paribus), respectively. Our findings therefore have important implications for evaluation aimed at reducing emissions impacts such measures.