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Guesstimate 5: Estimate The Monthly Electricity Consumption (Residential) in India

The document summarizes an approach to estimate monthly residential electricity consumption in India. It breaks down the approach into clarifying the market scope, considering adjustments for homeless and unelectrified populations, and weighing monthly consumption by household income type and number of households. The approach estimates 63,000 units for urban residential and 23,400 units for rural residential consumption per month.

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871 views1 page

Guesstimate 5: Estimate The Monthly Electricity Consumption (Residential) in India

The document summarizes an approach to estimate monthly residential electricity consumption in India. It breaks down the approach into clarifying the market scope, considering adjustments for homeless and unelectrified populations, and weighing monthly consumption by household income type and number of households. The approach estimates 63,000 units for urban residential and 23,400 units for rural residential consumption per month.

Uploaded by

Anon
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Guesstimate 5

Estimate the monthly electricity consumption (residential) in India

Interviewee Notes Case Facts Approach/ Framework Electricity


• Clarify end-markets to be • NA
included (residential /
commercial) because
consumption rates are very
different in these segments. In Residential Commercial
this case, focus only on
residential.
• Within rural segment,
Urban Population Rural Population =
interviewee should consider = 300m 700m
adjusting for (1) homeless
people and (2) areas which are
not electrified
• Weighing monthly consumption Households = Households =
300m/4 = 75m 700m/6 = 120m
by % of households in the
income type and multiplying
this by # of households will give
monthly units consumption Low Income 60% Mid Income 30% High Income 10% Low Income 70% Mid Income 25% High Income 5%

Monthly Monthly Monthly


Consumption Monthly Monthly Consumption Consumption Monthly
Consumption 1200 Consumption 3000 Consumption 1000
300 units 100 units 300

75m x (60% x 300 + 30% x 1200 + 10% x 3000) = 63,000 units 120m x (70% x 100 + 25% x 300 + 5% x 1000) = 23,400 units

Interview Summary
The candidate clarified the scope of the case (whether to include both residential and urban). Where he did not know, he made reasonable assumptions which he could justify.
Candidate showed awareness of demographic information (rural/urban split, income distribution split)

Observations/Tips/Suggestions
• Be careful with numbers; silly calculation mistakes could be harmful.
• First create structure, then put numbers to it.
• Make reasonable assumptions and clarify with interviewers at each stage.

(C) Consult Club, IIM Ahmedabad 2018-19 103

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