The measurement of affordability for electricity relies critically on a reliable estimate of the demand for electricity function. However, standard microeconomic theory falls short in providing a plausible framework within which such estimation could be made, at least in the case of electricity. Empirical work to date generally tends to assume that the affordability for electricity has no satiation point. Many models of the affordability for electricity assume a constant price elasticity, which implies infinite ability at low prices. The purpose of this technical note is to propose a plausible functional form for the affordability for electricity. The proposed functional form is consistent with four independent variables of electricity functions for households, namely, amount of average income per month, amount of average outcome for energy consumptions per month, amount of people remain in a household, and electricity power attached in a household.
The survey sampled 500 households throughout the four districts using a random sampling. Primary data, which is cross section, obtained directly from responder by observation, interview and questionnaire distribution. To estimate the affordability for electricity services, the linear regression method was used. The method was used to analyze the influence and correlation of four independent variables to dependent variable.
The result shows that the affordability for electricity of households in Salatiga is significantly influenced just by three independent variables, namely, amount of average income per month, amount of average outcome for energy consumptions per month and electricity power attached in a household. Individually, the amount of people remain in a household didn’t influence significantly to the affordability for electricity.
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