Energy efficiency and household behavior: The rebound effect in the residential sector

Erdal Aydin, N. Kok, Dirk Brounen

Research output: Contribution to journalArticleScientificpeer-review

Abstract

Over the years, various efficiency policies have been designed and implemented to reduce residential energy consumption. However, it is very common that the policy expectations that are based upon engineering calculations do not come true. The widely accepted explanation for the gap between expectation and the realization is the change of household behavior, as the energy efficiency gains change the perceived cost of energy services and thereby generate shifts in consumption patterns – the rebound effect. The real controversy about the rebound effect lies in the identification of its magnitude. In this paper, we estimate the rebound effect in residential energy consumption by comparing the actual gas consumption levels with the ex-ante predictions within a sample of well over 600,000 Dutch dwellings and households. We find a significant deviation between the engineering predictions and the households’ actual energy consumption, a difference which varies by ownership, wealth, income and the actual gas use intensity. Our results show a rebound effect of 26.7 percent among home-owners, and 41.3 percent among tenants. Moreover, we find that these effects are greatest among the lower income-wealth groups, and among households that tend to use more gas than average.
Original languageEnglish
Pages (from-to)749-782
JournalRAND Journal of Economics
Volume48
Issue number3
DOIs
Publication statusPublished - Aug 2017

Fingerprint

Household behavior
Energy efficiency
Rebound effect
Energy consumption
Household
Gas
Prediction
Expectations gap
Ownership
Deviation
Wealth and income
Wealth
Low income
Consumption patterns
Efficiency gains
Owners
Costs
Energy

Keywords

  • Energy efficiency
  • rebound effect
  • consumer behavior

Cite this

@article{e24972309c8c498781b13926e0f15429,
title = "Energy efficiency and household behavior: The rebound effect in the residential sector",
abstract = "Over the years, various efficiency policies have been designed and implemented to reduce residential energy consumption. However, it is very common that the policy expectations that are based upon engineering calculations do not come true. The widely accepted explanation for the gap between expectation and the realization is the change of household behavior, as the energy efficiency gains change the perceived cost of energy services and thereby generate shifts in consumption patterns – the rebound effect. The real controversy about the rebound effect lies in the identification of its magnitude. In this paper, we estimate the rebound effect in residential energy consumption by comparing the actual gas consumption levels with the ex-ante predictions within a sample of well over 600,000 Dutch dwellings and households. We find a significant deviation between the engineering predictions and the households’ actual energy consumption, a difference which varies by ownership, wealth, income and the actual gas use intensity. Our results show a rebound effect of 26.7 percent among home-owners, and 41.3 percent among tenants. Moreover, we find that these effects are greatest among the lower income-wealth groups, and among households that tend to use more gas than average.",
keywords = "Energy efficiency, rebound effect, consumer behavior",
author = "Erdal Aydin and N. Kok and Dirk Brounen",
year = "2017",
month = "8",
doi = "10.1111/1756-2171.12190",
language = "English",
volume = "48",
pages = "749--782",
journal = "RAND Journal of Economics",
issn = "0741-6261",
publisher = "Wiley",
number = "3",

}

Energy efficiency and household behavior : The rebound effect in the residential sector. / Aydin, Erdal; Kok, N.; Brounen, Dirk.

In: RAND Journal of Economics, Vol. 48, No. 3, 08.2017, p. 749-782.

Research output: Contribution to journalArticleScientificpeer-review

TY - JOUR

T1 - Energy efficiency and household behavior

T2 - The rebound effect in the residential sector

AU - Aydin, Erdal

AU - Kok, N.

AU - Brounen, Dirk

PY - 2017/8

Y1 - 2017/8

N2 - Over the years, various efficiency policies have been designed and implemented to reduce residential energy consumption. However, it is very common that the policy expectations that are based upon engineering calculations do not come true. The widely accepted explanation for the gap between expectation and the realization is the change of household behavior, as the energy efficiency gains change the perceived cost of energy services and thereby generate shifts in consumption patterns – the rebound effect. The real controversy about the rebound effect lies in the identification of its magnitude. In this paper, we estimate the rebound effect in residential energy consumption by comparing the actual gas consumption levels with the ex-ante predictions within a sample of well over 600,000 Dutch dwellings and households. We find a significant deviation between the engineering predictions and the households’ actual energy consumption, a difference which varies by ownership, wealth, income and the actual gas use intensity. Our results show a rebound effect of 26.7 percent among home-owners, and 41.3 percent among tenants. Moreover, we find that these effects are greatest among the lower income-wealth groups, and among households that tend to use more gas than average.

AB - Over the years, various efficiency policies have been designed and implemented to reduce residential energy consumption. However, it is very common that the policy expectations that are based upon engineering calculations do not come true. The widely accepted explanation for the gap between expectation and the realization is the change of household behavior, as the energy efficiency gains change the perceived cost of energy services and thereby generate shifts in consumption patterns – the rebound effect. The real controversy about the rebound effect lies in the identification of its magnitude. In this paper, we estimate the rebound effect in residential energy consumption by comparing the actual gas consumption levels with the ex-ante predictions within a sample of well over 600,000 Dutch dwellings and households. We find a significant deviation between the engineering predictions and the households’ actual energy consumption, a difference which varies by ownership, wealth, income and the actual gas use intensity. Our results show a rebound effect of 26.7 percent among home-owners, and 41.3 percent among tenants. Moreover, we find that these effects are greatest among the lower income-wealth groups, and among households that tend to use more gas than average.

KW - Energy efficiency

KW - rebound effect

KW - consumer behavior

U2 - 10.1111/1756-2171.12190

DO - 10.1111/1756-2171.12190

M3 - Article

VL - 48

SP - 749

EP - 782

JO - RAND Journal of Economics

JF - RAND Journal of Economics

SN - 0741-6261

IS - 3

ER -