Low-income energy efficiency programs and energy consumption

Pedro Hancevic, Profesor Investigador Titular de la División de Economía del CIDE, junto con Hector H. Sandoval escribieron el artículo Low-income energy efficiency programs and energy consumption en Journal of Environmental Economics and Management.



Low-income energy efficiency programs have become a major component of cities’ energy policy, with 49 out of 51 largest metropolitan areas in the U.S. offering one. This paper uses data from Gainesville Regional Utility to quantify the impacts of the housing investment done by its Low-income Energy Efficiency Program Plus (LEEP Plus) on energy consumption. Our results show that LEEP Plus does not affect natural gas consumption but reduces electricity consumption by approximately 7%, with greater savings occurring in the summer and winter. The effect on electricity consumption is significant to a variety of robustness checks and remains for at least 24 months after the completion of energy efficiency upgrades. We also measure some relevant heterogeneous effects, one of which is the breakdown of the air-conditioning-related investments, the main energy efficiency improvement under the LEEP Plus program. Finally, we evaluate the energy savings in monetary terms considering the private cost changes and the social cost changes. In both cases, the associated energy savings are not enough to offset the investment costs.


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