Follow India Renewable Energy News on WhatsApp for exclusive updates on clean energy news and insights

World Bank Report Highlights Impact of Electricity Price Hikes on Energy-Intensive Industries

A recent World Bank working paper, "Energy Prices, Energy Intensity, and Firm Performance," analyzes the effect of electricity price fluctuations on firm productivity, sales, and employment across 24 emerging markets and developing economies (EMDEs) between 2019–2023.

Key Findings:

• A 1% increase in electricity prices leads to a 1.5% reduction in employment within energy-intensive industries that have not adopted energy efficiency measures.
• While some firms may see an increase in productivity and sales, these effects are not consistently robust across different economic models.
• Firms that fail to adopt energy efficiency measures are the most vulnerable to energy price volatility, particularly in energy-intensive sectors.
• Encouraging widespread adoption of energy efficiency measures is essential to protect jobs and enhance industry resilience in the face of rising energy costs.

The study underscores the need for strong policy interventions to support energy efficiency adoption, particularly for firms in energy-intensive industries, as part of the broader green transition.