IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v306y2022ipas030626192101268x.html
   My bibliography  Save this article

Decomposition and measurement of the rebound effect: The case of energy efficiency improvements in Spain

Author

Listed:
  • Cansino, José M.
  • Ordóñez, Manuel
  • Prieto, Manuela

Abstract

The rebound effect caused by energy efficiency improvements demands greater attention from energy policymakers as it represents an important obstacle to energy consumption reduction measures. Despite the emerging literature about the rebound effect, no studies to date have managed to break down it. To do so, this study introduces the disruptive innovation of replacing the Logarithmic Mean Divisia Index method used in previous literature with Structural Decomposition Analysis. Based on Input-Output tables, a re-spending model allows us to assess the Indirect Rebound Effect for 14 productive sectors. Finally, Structural Decomposition Analysis enables us to determine the Economy-Wide Rebound Effect caused by energy efficiency improvements. As far as we are aware, no other study to date has done so. Spain is used as a case study for the 2000–2014 period. Major findings indicate that total rebound effect varies from nearly to 10% to around 50%. The part of rebound explained by Direct rebound effect is around 10%. Indirect rebound effect shows values between 1.2% and 1.8%. Finally, Economic wide rebound effect varies from −4.51% to around 40% but without showing a clear trend for the period considered. The novelty of this study is that it attempts to break the overall rebound effect down to the direct, indirect, and economic wide rebound effect by combining the Cobb-Douglas production function and decomposition techniques.

Suggested Citation

  • Cansino, José M. & Ordóñez, Manuel & Prieto, Manuela, 2022. "Decomposition and measurement of the rebound effect: The case of energy efficiency improvements in Spain," Applied Energy, Elsevier, vol. 306(PA).
    • Handle: RePEc:eee:appene:v:306:y:2022:i:pa:s030626192101268x
    DOI: 10.1016/j.apenergy.2021.117961
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S030626192101268X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2021.117961?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Brookes, Len, 1990. "The greenhouse effect: the fallacies in the energy efficiency solution," Energy Policy, Elsevier, vol. 18(2), pages 199-201, March.
    2. Barker, Terry & Ekins, Paul & Foxon, Tim, 2007. "Macroeconomic effects of efficiency policies for energy-intensive industries: The case of the UK Climate Change Agreements, 2000-2010," Energy Economics, Elsevier, vol. 29(4), pages 760-778, July.
    3. Labandeira, Xavier & Labeaga, José M. & López-Otero, Xiral, 2017. "A meta-analysis on the price elasticity of energy demand," Energy Policy, Elsevier, vol. 102(C), pages 549-568.
    4. Howard Pack, 1994. "Endogenous Growth Theory: Intellectual Appeal and Empirical Shortcomings," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 55-72, Winter.
    5. Murray, Anthony G. & Mills, Bradford F., 2011. "Read the label! Energy Star appliance label awareness and uptake among U.S. consumers," Energy Economics, Elsevier, vol. 33(6), pages 1103-1110.
    6. Saunders, Harry D., 2000. "A view from the macro side: rebound, backfire, and Khazzoom-Brookes," Energy Policy, Elsevier, vol. 28(6-7), pages 439-449, June.
    7. Sorrell, Steve & Dimitropoulos, John, 2008. "The rebound effect: Microeconomic definitions, limitations and extensions," Ecological Economics, Elsevier, vol. 65(3), pages 636-649, April.
    8. Stern, David I., 2020. "How large is the economy-wide rebound effect?," Energy Policy, Elsevier, vol. 147(C).
    9. Hediger, Cécile & Farsi, Mehdi & Weber, Sylvain, 2018. "Turn It Up and Open the Window: On the Rebound Effects in Residential Heating," Ecological Economics, Elsevier, vol. 149(C), pages 21-39.
    10. Kenneth Gillingham & Matthew J. Kotchen & David S. Rapson & Gernot Wagner, 2013. "The rebound effect is overplayed," Nature, Nature, vol. 493(7433), pages 475-476, January.
    11. Fullerton, Don & Ta, Chi L., 2020. "Costs of energy efficiency mandates can reverse the sign of rebound," Journal of Public Economics, Elsevier, vol. 188(C).
    12. Xie, Shi-Chen, 2014. "The driving forces of China׳s energy use from 1992 to 2010: An empirical study of input–output and structural decomposition analysis," Energy Policy, Elsevier, vol. 73(C), pages 401-415.
    13. Bruns, Stephan B. & Moneta, Alessio & Stern, David I., 2021. "Estimating the economy-wide rebound effect using empirically identified structural vector autoregressions," Energy Economics, Elsevier, vol. 97(C).
    14. Turner, Karen, 2009. "Negative rebound and disinvestment effects in response to an improvement in energy efficiency in the UK economy," Energy Economics, Elsevier, vol. 31(5), pages 648-666, September.
    15. Duarte, Rosa & Sánchez-Chóliz, Julio & Sarasa, Cristina, 2018. "Consumer-side actions in a low-carbon economy: A dynamic CGE analysis for Spain," Energy Policy, Elsevier, vol. 118(C), pages 199-210.
    16. Katrina Jessoe & David Rapson, 2014. "Knowledge Is (Less) Power: Experimental Evidence from Residential Energy Use," American Economic Review, American Economic Association, vol. 104(4), pages 1417-1438, April.
    17. A. Greening, Lorna & Greene, David L. & Difiglio, Carmen, 2000. "Energy efficiency and consumption -- the rebound effect -- a survey," Energy Policy, Elsevier, vol. 28(6-7), pages 389-401, June.
    18. Frondel, Manuel & Ritter, Nolan & Vance, Colin, 2012. "Heterogeneity in the rebound effect: Further evidence for Germany," Energy Economics, Elsevier, vol. 34(2), pages 461-467.
    19. Morakinyo O. Adetutu, Anthony J. Glass, and Thomas G. Weyman-Jones, 2016. "Economy-wide Estimates of Rebound Effects: Evidence from Panel Data," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    20. Koichiro Ito, 2014. "Do Consumers Respond to Marginal or Average Price? Evidence from Nonlinear Electricity Pricing," American Economic Review, American Economic Association, vol. 104(2), pages 537-563, February.
    21. Griffin, James M, 1981. "Engineering and Econometric Interpretations of Energy-Capital Complementarity: Comment," American Economic Review, American Economic Association, vol. 71(5), pages 1100-1104, December.
    22. Hanley, Nick & McGregor, Peter G. & Swales, J. Kim & Turner, Karen, 2009. "Do increases in energy efficiency improve environmental quality and sustainability?," Ecological Economics, Elsevier, vol. 68(3), pages 692-709, January.
    23. Yan, Zheming & Ouyang, Xiaoling & Du, Kerui, 2019. "Economy-wide estimates of energy rebound effect: Evidence from China's provinces," Energy Economics, Elsevier, vol. 83(C), pages 389-401.
    24. Thomas, Brinda A. & Azevedo, Inês L., 2013. "Estimating direct and indirect rebound effects for U.S. households with input–output analysis. Part 2: Simulation," Ecological Economics, Elsevier, vol. 86(C), pages 188-198.
    25. Amjadi, Golnaz & Lundgren, Tommy & Persson, Lars, 2018. "The Rebound Effect in Swedish Heavy Industry," Energy Economics, Elsevier, vol. 71(C), pages 140-148.
    26. Marcel P. Timmer & Erik Dietzenbacher & Bart Los & Robert Stehrer & Gaaitzen J. Vries, 2015. "An Illustrated User Guide to the World Input–Output Database: the Case of Global Automotive Production," Review of International Economics, Wiley Blackwell, vol. 23(3), pages 575-605, August.
    27. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
    28. Llorca, Manuel & Jamasb, Tooraj, 2017. "Energy efficiency and rebound effect in European road freight transport," Transportation Research Part A: Policy and Practice, Elsevier, vol. 101(C), pages 98-110.
    29. Cansino, José M. & Sánchez-Braza, Antonio & Rodríguez-Arévalo, María L., 2015. "Driving forces of Spain׳s CO2 emissions: A LMDI decomposition approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 48(C), pages 749-759.
    30. Jin, Taeyoung & Kim, Jinsoo, 2019. "A new approach for assessing the macroeconomic growth energy rebound effect," Applied Energy, Elsevier, vol. 239(C), pages 192-200.
    31. Kenneth Gillingham & David Rapson & Gernot Wagner, 2016. "The Rebound Effect and Energy Efficiency Policy," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 10(1), pages 68-88.
    32. Lin, Boqiang & Chen, Yufang & Zhang, Guoliang, 2017. "Technological progress and rebound effect in China's nonferrous metals industry: An empirical study," Energy Policy, Elsevier, vol. 109(C), pages 520-529.
    33. Brizga, Janis & Feng, Kuishuang & Hubacek, Klaus, 2014. "Drivers of greenhouse gas emissions in the Baltic States: A structural decomposition analysis," Ecological Economics, Elsevier, vol. 98(C), pages 22-28.
    34. Turner, Karen & Hanley, Nick, 2011. "Energy efficiency, rebound effects and the environmental Kuznets Curve," Energy Economics, Elsevier, vol. 33(5), pages 709-720, September.
    35. Qiang Du & Yi Li & Libiao Bai, 2017. "The Energy Rebound Effect for the Construction Industry: Empirical Evidence from China," Sustainability, MDPI, vol. 9(5), pages 1-11, May.
    36. Font Vivanco, David & Kemp, René & van der Voet, Ester, 2016. "How to deal with the rebound effect? A policy-oriented approach," Energy Policy, Elsevier, vol. 94(C), pages 114-125.
    37. Smeets, Edward & Tabeau, Andrzej & van Berkum, Siemen & Moorad, Jamil & van Meijl, Hans & Woltjer, Geert, 2014. "The impact of the rebound effect of the use of first generation biofuels in the EU on greenhouse gas emissions: A critical review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 38(C), pages 393-403.
    38. Bye, Brita & Fæhn, Taran & Rosnes, Orvika, 2018. "Residential energy efficiency policies: Costs, emissions and rebound effects," Energy, Elsevier, vol. 143(C), pages 191-201.
    39. Vassileva, Iana & Campillo, Javier, 2014. "Increasing energy efficiency in low-income households through targeting awareness and behavioral change," Renewable Energy, Elsevier, vol. 67(C), pages 59-63.
    40. Erik Dietzenbacher & Bart Los, 1998. "Structural Decomposition Techniques: Sense and Sensitivity," Economic Systems Research, Taylor & Francis Journals, vol. 10(4), pages 307-324.
    41. Philippe Barla & Bernard Lamonde & Luis Miranda-Moreno & Nathalie Boucher, 2009. "Traveled distance, stock and fuel efficiency of private vehicles in Canada: price elasticities and rebound effect," Transportation, Springer, vol. 36(4), pages 389-402, July.
    42. Ouyang, Xiaoling & Gao, Beiying & Du, Kerui & Du, Gang, 2018. "Industrial sectors' energy rebound effect: An empirical study of Yangtze River Delta urban agglomeration," Energy, Elsevier, vol. 145(C), pages 408-416.
    43. Binswanger, Mathias, 2001. "Technological progress and sustainable development: what about the rebound effect?," Ecological Economics, Elsevier, vol. 36(1), pages 119-132, January.
    44. Kulmer, Veronika & Seebauer, Sebastian, 2019. "How robust are estimates of the rebound effect of energy efficiency improvements? A sensitivity analysis of consumer heterogeneity and elasticities," Energy Policy, Elsevier, vol. 132(C), pages 1-14.
    45. Wang, Qiang & Jiang, Xue-ting & Li, Rongrong, 2017. "Comparative decoupling analysis of energy-related carbon emission from electric output of electricity sector in Shandong Province, China," Energy, Elsevier, vol. 127(C), pages 78-88.
    46. J. Daniel Khazzoom, 1980. "Economic Implications of Mandated Efficiency in Standards for Household Appliances," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 21-40.
    47. Richard B. Howarth, 1997. "Energy Efficiency And Economic Growth," Contemporary Economic Policy, Western Economic Association International, vol. 15(4), pages 1-9, October.
    48. Allcott, Hunt, 2011. "Rethinking real-time electricity pricing," Resource and Energy Economics, Elsevier, vol. 33(4), pages 820-842.
    49. Douglas, Paul H, 1976. "The Cobb-Douglas Production Function Once Again: Its History, Its Testing, and Some New Empirical Values," Journal of Political Economy, University of Chicago Press, vol. 84(5), pages 903-915, October.
    50. Cansino, José M. & Román-Collado, Rocío & Merchán, José, 2019. "Do Spanish energy efficiency actions trigger JEVON’S paradox?," Energy, Elsevier, vol. 181(C), pages 760-770.
    51. Orea, Luis & Llorca, Manuel & Filippini, Massimo, 2015. "A new approach to measuring the rebound effect associated to energy efficiency improvements: An application to the US residential energy demand," Energy Economics, Elsevier, vol. 49(C), pages 599-609.
    52. Yu, Xuewei & Moreno-Cruz, Juan & Crittenden, John C., 2015. "Regional energy rebound effect: The impact of economy-wide and sector level energy efficiency improvement in Georgia, USA," Energy Policy, Elsevier, vol. 87(C), pages 250-259.
    53. Liu, Hongxun & Du, Kerui & Li, Jianglong, 2019. "An improved approach to estimate direct rebound effect by incorporating energy efficiency: A revisit of China's industrial energy demand," Energy Economics, Elsevier, vol. 80(C), pages 720-730.
    54. Román-Collado, Rocío & Cansino, José M. & Botia, Camilo, 2018. "How far is Colombia from decoupling? Two-level decomposition analysis of energy consumption changes," Energy, Elsevier, vol. 148(C), pages 687-700.
    55. Murray, Anthony G. & Mills, Bradford F., 2011. "Read the Label! Energy Star Appliance Awareness and Uptake Among U.S. Consumers," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103328, Agricultural and Applied Economics Association.
    56. Safarzadeh, Soroush & Rasti-Barzoki, Morteza & Hejazi, Seyed Reza, 2020. "A review of optimal energy policy instruments on industrial energy efficiency programs, rebound effects, and government policies," Energy Policy, Elsevier, vol. 139(C).
    57. Santarius, Tilman & Soland, Martin, 2018. "How Technological Efficiency Improvements Change Consumer Preferences: Towards a Psychological Theory of Rebound Effects," Ecological Economics, Elsevier, vol. 146(C), pages 414-424.
    58. Craglia, Matteo & Cullen, Jonathan, 2020. "Do vehicle efficiency improvements lead to energy savings? The rebound effect in Great Britain," Energy Economics, Elsevier, vol. 88(C).
    59. Zhang, Jiangshan & Lin Lawell, C.-Y. Cynthia, 2017. "The macroeconomic rebound effect in China," Energy Economics, Elsevier, vol. 67(C), pages 202-212.
    60. Antal, Miklós & van den Bergh, Jeroen C.J.M., 2014. "Re-spending rebound: A macro-level assessment for OECD countries and emerging economies," Energy Policy, Elsevier, vol. 68(C), pages 585-590.
    61. Cansino, José M. & Román, Rocío & Ordóñez, Manuel, 2016. "Main drivers of changes in CO2 emissions in the Spanish economy: A structural decomposition analysis," Energy Policy, Elsevier, vol. 89(C), pages 150-159.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Madurai Elavarasan, Rajvikram & Nadarajah, Mithulananthan & Pugazhendhi, Rishi & Sinha, Avik & Gangatharan, Sivasankar & Chiaramonti, David & Abou Houran, Mohamad, 2023. "The untold subtlety of energy consumption and its influence on policy drive towards Sustainable Development Goal 7," Applied Energy, Elsevier, vol. 334(C).
    2. Maliyamu Abudureheman & Qingzhe Jiang & Xiucheng Dong & Cong Dong, 2022. "CO 2 Emissions in China: Does the Energy Rebound Matter?," Energies, MDPI, vol. 15(12), pages 1-25, June.
    3. Amjadi, Golnaz & Lundgren, Tommy, 2022. "Is industrial energy inefficiency transient or persistent? Evidence from Swedish manufacturing," Applied Energy, Elsevier, vol. 309(C).
    4. Guan, Zepeng & Hossain, Mohammad Razib & Sheikh, Muhammad Ramzan & Khan, Zeeshan & Gu, Xiao, 2023. "Unveiling the interconnectedness between energy-related GHGs and pro-environmental energy technology: Lessons from G-7 economies with MMQR approach," Energy, Elsevier, vol. 281(C).
    5. Ouyang, Xiaoling & Yang, Yuchuan & Du, Kerui & Cheng, Zhenyu, 2022. "How does residential electricity consumption respond to electricity efficiency improvement? Evidence from 287 prefecture-level cities in China," Energy Policy, Elsevier, vol. 171(C).
    6. Kong, Li & Mu, Xianzhong & Hu, Guangwen & Tu, Chuang, 2023. "Will energy efficiency improvements reduce energy consumption? Perspective of rebound effect and evidence from beijing," Energy, Elsevier, vol. 263(PA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cansino, José M. & Román-Collado, Rocío & Merchán, José, 2019. "Do Spanish energy efficiency actions trigger JEVON’S paradox?," Energy, Elsevier, vol. 181(C), pages 760-770.
    2. Jafari, Mahboubeh & Stern, David I. & Bruns, Stephan B., 2022. "How large is the economy-wide rebound effect in middle income countries? Evidence from Iran," Ecological Economics, Elsevier, vol. 193(C).
    3. Jarke-Neuert, Johannes & Perino, Grischa, 2020. "Energy efficiency promotion backfires under cap-and-trade," Resource and Energy Economics, Elsevier, vol. 62(C).
    4. Rocha, Felipe Freitas da & Almeida, Edmar Luiz Fagundes de, 2021. "A general equilibrium model of macroeconomic rebound effect: A broader view," Energy Economics, Elsevier, vol. 98(C).
    5. Brockway, Paul E. & Sorrell, Steve & Semieniuk, Gregor & Heun, Matthew Kuperus & Court, Victor, 2021. "Energy efficiency and economy-wide rebound effects: A review of the evidence and its implications," Renewable and Sustainable Energy Reviews, Elsevier, vol. 141(C).
    6. David Font Vivanco & Jaume Freire‐González & Ray Galvin & Tilman Santarius & Hans Jakob Walnum & Tamar Makov & Serenella Sala, 2022. "Rebound effect and sustainability science: A review," Journal of Industrial Ecology, Yale University, vol. 26(4), pages 1543-1563, August.
    7. Jin, Taeyoung & Kim, Jinsoo, 2019. "A new approach for assessing the macroeconomic growth energy rebound effect," Applied Energy, Elsevier, vol. 239(C), pages 192-200.
    8. Font Vivanco, David & Nechifor, Victor & Freire-González, Jaume & Calzadilla, Alvaro, 2021. "Economy-wide rebound makes UK’s electric car subsidy fall short of expectations," Applied Energy, Elsevier, vol. 297(C).
    9. Rongxin Wu & Boqiang Lin, 2022. "Does Energy Efficiency Realize Energy Conservation in the Iron and Steel Industry? A Perspective of Energy Rebound Effect," IJERPH, MDPI, vol. 19(18), pages 1-20, September.
    10. David Font Vivanco & Serenella Sala & Will McDowall, 2018. "Roadmap to Rebound: How to Address Rebound Effects from Resource Efficiency Policy," Sustainability, MDPI, vol. 10(6), pages 1-17, June.
    11. Berner, Anne & Bruns, Stephan & Moneta, Alessio & Stern, David I., 2022. "Do energy efficiency improvements reduce energy use? Empirical evidence on the economy-wide rebound effect in Europe and the United States," Energy Economics, Elsevier, vol. 110(C).
    12. Toroghi, Shahaboddin H. & Oliver, Matthew E., 2019. "Framework for estimation of the direct rebound effect for residential photovoltaic systems," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    13. Chang, Juin-Jen & Wang, Wei-Neng & Shieh, Jhy-Yuan, 2018. "Environmental rebounds/backfires: Macroeconomic implications for the promotion of environmentally-friendly products," Journal of Environmental Economics and Management, Elsevier, vol. 88(C), pages 35-68.
    14. Khoshkalam Khosroshahi, Musa & Sayadi, Mohammad, 2020. "Tracking the sources of rebound effect resulting from the efficiency improvement in petrol, diesel, natural gas and electricity consumption; A CGE analysis for Iran," Energy, Elsevier, vol. 197(C).
    15. Adha, Rishan & Hong, Cheng-Yih & Firmansyah, M. & Paranata, Ade, 2021. "Rebound effect with energy efficiency determinants: a two-stage analysis of residential electricity consumption in Indonesia," MPRA Paper 110444, University Library of Munich, Germany.
    16. Safarzadeh, Soroush & Rasti-Barzoki, Morteza & Hejazi, Seyed Reza, 2020. "A review of optimal energy policy instruments on industrial energy efficiency programs, rebound effects, and government policies," Energy Policy, Elsevier, vol. 139(C).
    17. Zhang, Jiangshan & Lin Lawell, C.-Y. Cynthia, 2017. "The macroeconomic rebound effect in China," Energy Economics, Elsevier, vol. 67(C), pages 202-212.
    18. Stern, David I., 2020. "How large is the economy-wide rebound effect?," Energy Policy, Elsevier, vol. 147(C).
    19. Thomas, Brinda A. & Azevedo, Inês L., 2013. "Estimating direct and indirect rebound effects for U.S. households with input–output analysis Part 1: Theoretical framework," Ecological Economics, Elsevier, vol. 86(C), pages 199-210.
    20. Broberg, Thomas & Berg, Charlotte & Samakovlis, Eva, 2015. "The economy-wide rebound effect from improved energy efficiency in Swedish industries–A general equilibrium analysis," Energy Policy, Elsevier, vol. 83(C), pages 26-37.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:appene:v:306:y:2022:i:pa:s030626192101268x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.