Predicting the Demand for Electricity — An Application of Transfer function Analysis

Abstract

For various important decisions, managers of the electric utility industry must rely on information about the future development of output (kW or kWh) and revenue,, Examples are budgeting, investment and financial planning decisions, which, by their very nature, need to be based on medium to long-range forecasts with a time horizon between approximately one and ten years. This results in a difference in the nature of the problem — but not necessarily with respect to the forecasting technique — relative to the very short-run information required on the perceived system load.