Reserve buffer capacity Opr It is
Most modern societies are market economies of various forms, and since tradable energy commodities dominate total energy flows, energy demand is manifest as the aggregate purchases of those energy commodities in various markets. A distinction is commonly made between primary and final energy consumption, with conversion and distribution losses making the former larger than the latter. With energy suppliers facing rising marginal costs, energy ABT-538 facing declining marginal utility, and government and regulatory bodies intervening in various ways, the demand for these energy commodities is in large part the emergent outcome of multiple economic decisions by multiple economic actors in multiple markets. Hence, energy demand is fundamentally an economic concept that can be investigated with the tools of economics. Energy demand responds to changes in energy prices, although to different degrees in different markets and over different periods of time. However, the simple textbook model of rational decision-making by well-informed actors in well-functioning markets provides a poor approximation to the markets for energy commodities and energy-using products, and an even poorer approximation to the ‘market’ for energy efficiency. This model therefore needs to be modified for more useful insights to be obtained.