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Residential energy use and conservation: Economics and demographics

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  • Brounen, Dirk
  • Kok, Nils
  • Quigley, John M.

Abstract

Energy consumption in the residential sector offers an important opportunity for conserving resources. However, much of the current debate regarding energy efficiency in the housing market focuses on the physical and technical determinants of energy consumption, neglecting the role of the economic behavior of resident households. In this paper, we analyze the extent to which the use of gas and electricity is determined by the technical specifications of the dwelling as compared to the demographic characteristics of the residents. Our analysis is based on a sample of more than 300,000 Dutch homes and their occupants. The results indicate that residential gas consumption is determined principally by structural dwelling characteristics, such as the vintage, building type, and characteristics of the dwelling, while electricity consumption varies more directly with household composition, in particular income and family composition. Combining these results with projections on future economic and demographic trends, we find that, even absent price increases for residential energy, the aging of the population and their increasing wealth will roughly offset improvements in the energy efficiency of the building stock resulting from policy interventions and natural revitalization.

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Bibliographic Info

Article provided by Elsevier in its journal European Economic Review.

Volume (Year): 56 (2012)
Issue (Month): 5 ()
Pages: 931-945

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Handle: RePEc:eee:eecrev:v:56:y:2012:i:5:p:931-945

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Web page: http://www.elsevier.com/locate/eer

Related research

Keywords: Energy efficiency; Housing; Demographics;

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References

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  1. Ian Ayres & Sophie Raseman & Alice Shih, 2009. "Evidence from Two Large Field Experiments that Peer Comparison Feedback Can Reduce Residential Energy Usage," NBER Working Papers 15386, National Bureau of Economic Research, Inc.
  2. Rehdanz, Katrin, 2007. "Determinants of residential space heating expenditures in Germany," Energy Economics, Elsevier, vol. 29(2), pages 167-182, March.
  3. Levinson, Arik & Niemann, Scott, 2004. "Energy use by apartment tenants when landlords pay for utilities," Resource and Energy Economics, Elsevier, vol. 26(1), pages 51-75, March.
  4. Piet Eichholtz & Nils Kok & John M. Quigley, 2010. "Doing Well by Doing Good? Green Office Buildings," American Economic Review, American Economic Association, vol. 100(5), pages 2492-2509, December.
  5. Helena Meier & Katrin Rehdanz, 2008. "Determinants of Residential Space Heating Expenditures in Great Britain," Working Papers FNU-166, Research unit Sustainability and Global Change, Hamburg University, revised Jul 2008.
  6. Dora L. Costa & Matthew E. Kahn, 2011. "Electricity Consumption and Durable Housing: Understanding Cohort Effects," NBER Working Papers 16732, National Bureau of Economic Research, Inc.
  7. Peter C. Reiss & Matthew W. White, 2008. "What changes energy consumption? Prices and public pressures," RAND Journal of Economics, RAND Corporation, vol. 39(3), pages 636-663.
  8. Jaffe, Adam B. & Stavins, Robert N., 1994. "The energy paradox and the diffusion of conservation technology," Resource and Energy Economics, Elsevier, vol. 16(2), pages 91-122, May.
  9. Wilhite, Harold & Nakagami, Hidetoshi & Masuda, Takashi & Yamaga, Yukiko & Haneda, Hiroshi, 1996. "A cross-cultural analysis of household energy use behaviour in Japan and Norway," Energy Policy, Elsevier, vol. 24(9), pages 795-803, September.
  10. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
  11. Peter C. Reiss & Matthew W. White, 2005. "Household Electricity Demand, Revisited," Review of Economic Studies, Oxford University Press, vol. 72(3), pages 853-883.
  12. Van Raaij, W. Fred & Verhallen, Theo M. M., 1983. "A behavioral model of residential energy use," Journal of Economic Psychology, Elsevier, vol. 3(1), pages 39-63.
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Citations

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Cited by:
  1. Dieckhoener, Caroline, 2012. "Does subsidizing investments in energy efficiency reduce energy consumption? Evidence from Germany," EWI Working Papers 2012-17, Energiewirtschaftliches Institut an der Universitaet zu Koeln.
  2. Alberto Gago & Michael Hanemann & Xavier Labandeira & Ana Ramos, 2012. "Climate Change, Buildings and Energy Prices," Working Papers fa04-2012, Economics for Energy.
  3. Arik Levinson, 2013. "California Energy Efficiency: Lessons for the Rest of the World, or Not?," Working Papers gueconwpa~13-13-03, Georgetown University, Department of Economics.
  4. Fell, Michael J. & Chiu, Lai Fong, 2014. "Children, parents and home energy use: Exploring motivations and limits to energy demand reduction," Energy Policy, Elsevier, vol. 65(C), pages 351-358.
  5. Peter Heindl, 2014. "Measuring Fuel Poverty: General Considerations and Application to German Household Data," SOEPpapers on Multidisciplinary Panel Data Research 632, DIW Berlin, The German Socio-Economic Panel (SOEP).
  6. Claus Michelsen & Sebastian Rosenschon, 2012. "The Effects of Building Energy Codes in Rental Housing: The German Experience," Economics Bulletin, AccessEcon, vol. 32(4), pages 3488-3502.
  7. Garau, Giorgio & Lecca, Patrizio & Mandras, Giovanni, 2013. "The impact of population ageing on energy use: Evidence from Italy," Economic Modelling, Elsevier, vol. 35(C), pages 970-980.
  8. Carsten Schroder & Katrin Rehdanz & Daiju Narita & Toshihiro Okubo, 2013. "Household formation and residential energy demand: Evidence from Japan," Keio/Kyoto Joint Global COE Discussion Paper Series 2012-047, Keio/Kyoto Joint Global COE Program.
  9. Nils Kok & Marquise McGraw & John Quigley, 2012. "The diffusion over time and space of energy efficiency in building," The Annals of Regional Science, Springer, vol. 48(2), pages 541-564, April.
  10. Brounen, Dirk & Kok, Nils & Quigley, John M., 2013. "Energy literacy, awareness, and conservation behavior of residential households," Energy Economics, Elsevier, vol. 38(C), pages 42-50.

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