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Determinants of residential space heating expenditures in Great Britain

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  • Helena Meier
  • Katrin Rehdanz

Abstract

In Great Britain several policy measures have been implemented in order to increase energy efficiency and to reduce carbon emissions. In the domestic sector, these targets can be achieved by improving space heating efficiency and, hence, decrease heating expenditures. However, before implementing policy measures it is necessary to better understand determinants of heating expenditures. In this paper, we examine determinants of heating expenditures which include socio-economic and building characteristics as well as heating technologies and meteorological observations. In contrast to most other studies, we use Panel data for investigating household’s demand for heating in Great Britain. Our analysis covers 15 years, starting in 1991, and more than 5,000 households that have been re-interviewed annually; altogether our sample covers more than 64,000 households. Our empirical findings suggest that in Great Britain owners generally have higher heating expenditures than renters. These differences in expenditures can be explained by building characteristics. Renters mainly live in flats and most of the owners live in detached/semi-detached houses. Generally, flats are more energy efficient than houses. Our results also imply that a number of socio-economic criteria have a significant influence on heating expenditures, independent from the central heating fuel type. Policy measures should not only focus on insulation standards but also on different household types. Especially elderly people and households with children should be target groups

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Bibliographic Info

Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1439.

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Length: 23 pages
Date of creation: Jul 2008
Date of revision:
Handle: RePEc:kie:kieliw:1439

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Keywords: Great Britain; Space Heating; Income elasticity; Price Elasticity;

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  1. Dubin, Jeffrey A & McFadden, Daniel L, 1984. "An Econometric Analysis of Residential Electric Appliance Holdings and Consumption," Econometrica, Econometric Society, vol. 52(2), pages 345-62, March.
  2. van den Bergh, Jeroen C.J.M., 2008. "Environmental regulation of households: An empirical review of economic and psychological factors," Ecological Economics, Elsevier, vol. 66(4), pages 559-574, July.
  3. Rehdanz, Katrin, 2007. "Determinants of residential space heating expenditures in Germany," Energy Economics, Elsevier, vol. 29(2), pages 167-182, March.
  4. Leth-Petersen, Soren & Togeby, Mikael, 2001. "Demand for space heating in apartment blocks: measuring effects of policy measures aiming at reducing energy consumption," Energy Economics, Elsevier, vol. 23(4), pages 387-403, July.
  5. Simon Dresner & Paul Ekins, 2006. "Economic instruments to improve UK home energy efficiency without negative social impacts," Fiscal Studies, Institute for Fiscal Studies, vol. 27(1), pages 47-74, March.
  6. Nesbakken, Runa, 2001. " Energy Consumption for Space Heating: A Discrete-Continuous Approach," Scandinavian Journal of Economics, Wiley Blackwell, vol. 103(1), pages 165-84, March.
  7. Baker, Paul & Blundell, Richard & Micklewright, John, 1989. "Modelling Household Energy Expenditures Using Micro-data," Economic Journal, Royal Economic Society, vol. 99(397), pages 720-38, September.
  8. Druckman, A. & Jackson, T., 2008. "Household energy consumption in the UK: A highly geographically and socio-economically disaggregated model," Energy Policy, Elsevier, vol. 36(8), pages 3167-3182, August.
  9. Laura Blow, 2004. "Household Expenditures Patterns in the UK," DEMPATEM Working Papers wp2, AIAS, Amsterdam Institute for Advanced Labour Studies.
  10. Nesbakken, Runa, 1999. "Price sensitivity of residential energy consumption in Norway," Energy Economics, Elsevier, vol. 21(6), pages 493-515, December.
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Cited by:
  1. Brounen, Dirk & Kok, Nils & Quigley, John M., 2012. "Residential energy use and conservation: Economics and demographics," European Economic Review, Elsevier, vol. 56(5), pages 931-945.
  2. Caroline Dieckhöner, 2012. "Does Subsidizing Investments in Energy Efficiency Reduce Energy Consumption?: Evidence from Germany," SOEPpapers on Multidisciplinary Panel Data Research 527, DIW Berlin, The German Socio-Economic Panel (SOEP).
  3. Alberini, Anna & Gans, Will & Velez-Lopez, Daniel, 2011. "Residential consumption of gas and electricity in the U.S.: The role of prices and income," Energy Economics, Elsevier, vol. 33(5), pages 870-881, September.
  4. Arie ten Cate, 2012. "The socially optimal energy transition in a residential neighbourhood in the Netherlands," CPB Discussion Paper 222, CPB Netherlands Bureau for Economic Policy Analysis.
  5. Büchs, Milena & Schnepf, Sylke V., 2013. "Who emits most? Associations between socio-economic factors and UK households' home energy, transport, indirect and total CO2 emissions," Ecological Economics, Elsevier, vol. 90(C), pages 114-123.
  6. Heindl, Peter, 2013. "Measuring fuel poverty: General considerations and application to German household data," ZEW Discussion Papers 13-046, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  7. Lange, Ian & Moro, Mirko & Traynor, Laura, 2012. "Green Hypocrisy?: Environmental Attitudes and Residential Space Heating Expenditure," Stirling Economics Discussion Papers 2012-12, University of Stirling, Division of Economics.
  8. Brutscher, P-B., 2012. "Making Sense of Oil Stamp Saving Schemes," Cambridge Working Papers in Economics 1203, Faculty of Economics, University of Cambridge.

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