A prerequisite for the development of an effective energy policy is knowledge of the relative importance of the factors affecting the demand for electricity. Basic economic theory postulates that demand responds to numerous influences, among the more important ones being prices (of the product itself, of substitute goods, and of complementary goods), income levels, plus other social, economic, demographic, and physical factors. When analyzing a derived demand, information about the stock and usage of the products requiring the immediate commodity can be incorporated in the relationship.