Energy Efficiency and Rebound Effects: An Econometric Analysis of Energy Demand in the Commercial Building Sector

Yueming Qiu

doi:10.1007/s10640-013-9729-9

Energy Efficiency and Rebound Effects: An Econometric Analysis of Energy Demand in the Commercial Building Sector

Yueming Qiu

Arizona State University

Research output: Contribution to journal › Article › peer-review

15 Scopus citations

Abstract

It is widely recognized that the adoption of energy saving innovations can induce an increase in the usage of the corresponding technologies and thus can possibly increase energy consumption. Among other concerns is that uncertainties regarding the magnitude of this "rebound effect" can deter policy makers from promoting energy efficiency. This paper analyzes the rebound effects of the adoption of energy efficient technologies in commercial buildings. Based upon a structural model of technology adoption and subsequent energy demand at the building level, the empirical results are that energy efficiency can reduce electricity use by about 35 % and natural gas consumption by about 50 %.

Original language	English (US)
Pages (from-to)	295-335
Number of pages	41
Journal	Environmental and Resource Economics
Volume	59
Issue number	2
DOIs	https://doi.org/10.1007/s10640-013-9729-9
State	Published - Oct 2014

Keywords

Electricity and natural gas demand
Energy efficiency
Heckman selection model
Price elasticity
Rebound effect

ASJC Scopus subject areas

Economics and Econometrics
Management, Monitoring, Policy and Law

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title = "Energy Efficiency and Rebound Effects: An Econometric Analysis of Energy Demand in the Commercial Building Sector",

abstract = "It is widely recognized that the adoption of energy saving innovations can induce an increase in the usage of the corresponding technologies and thus can possibly increase energy consumption. Among other concerns is that uncertainties regarding the magnitude of this {"}rebound effect{"} can deter policy makers from promoting energy efficiency. This paper analyzes the rebound effects of the adoption of energy efficient technologies in commercial buildings. Based upon a structural model of technology adoption and subsequent energy demand at the building level, the empirical results are that energy efficiency can reduce electricity use by about 35 % and natural gas consumption by about 50 %.",

keywords = "Electricity and natural gas demand, Energy efficiency, Heckman selection model, Price elasticity, Rebound effect",

author = "Yueming Qiu",

note = "Funding Information: This paper is modified from a chapter of my doctoral dissertation at Stanford University. I would like to thank the Precourt Energy Efficiency Center for the funding that made this research possible. I would also like to thank Matt Harding and Luigi Pistaferri from Stanford Department of Economics, Jim Sweeney from Stanford Department of Management Science and Engineering, Laura Diaz Anadon from Harvard Kenney School, Kenny Gillingham from Yale School of Forestry and Environmental Studies, and Yi David Wang from University of International Business and Economics for extremely useful suggestions, Shirley Neff and Joelle Michaels from US Energy Information Administration for providing advice on the Commercial Buildings Energy Consumption Survey data. Any remaining errors are my own responsibility.",

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AU - Qiu, Yueming

N1 - Funding Information: This paper is modified from a chapter of my doctoral dissertation at Stanford University. I would like to thank the Precourt Energy Efficiency Center for the funding that made this research possible. I would also like to thank Matt Harding and Luigi Pistaferri from Stanford Department of Economics, Jim Sweeney from Stanford Department of Management Science and Engineering, Laura Diaz Anadon from Harvard Kenney School, Kenny Gillingham from Yale School of Forestry and Environmental Studies, and Yi David Wang from University of International Business and Economics for extremely useful suggestions, Shirley Neff and Joelle Michaels from US Energy Information Administration for providing advice on the Commercial Buildings Energy Consumption Survey data. Any remaining errors are my own responsibility.

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N2 - It is widely recognized that the adoption of energy saving innovations can induce an increase in the usage of the corresponding technologies and thus can possibly increase energy consumption. Among other concerns is that uncertainties regarding the magnitude of this "rebound effect" can deter policy makers from promoting energy efficiency. This paper analyzes the rebound effects of the adoption of energy efficient technologies in commercial buildings. Based upon a structural model of technology adoption and subsequent energy demand at the building level, the empirical results are that energy efficiency can reduce electricity use by about 35 % and natural gas consumption by about 50 %.

AB - It is widely recognized that the adoption of energy saving innovations can induce an increase in the usage of the corresponding technologies and thus can possibly increase energy consumption. Among other concerns is that uncertainties regarding the magnitude of this "rebound effect" can deter policy makers from promoting energy efficiency. This paper analyzes the rebound effects of the adoption of energy efficient technologies in commercial buildings. Based upon a structural model of technology adoption and subsequent energy demand at the building level, the empirical results are that energy efficiency can reduce electricity use by about 35 % and natural gas consumption by about 50 %.

KW - Electricity and natural gas demand

KW - Energy efficiency

KW - Heckman selection model

KW - Price elasticity

KW - Rebound effect

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Energy Efficiency and Rebound Effects: An Econometric Analysis of Energy Demand in the Commercial Building Sector

Abstract

Keywords

ASJC Scopus subject areas

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