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The European Commission's light bulb decree: Another costly regulation?

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  • Frondel, Manuel
  • Lohmann, Steffen

Abstract

Since September 2009, Regulation 244/2009 of the European Commission enforces the gradual phase-out of incandescent light bulbs. As of September 2012, only energy-efficient lighting sources will be allowed for sale. Among these are halogen light bulbs, light-emitting diodes (LED), or compact fluorescent light bulbs--often referred to as energy-saving light bulbs. The Commission's justification for the phase-out of conventional light bulbs maintains that a reduction in the electricity consumed will not only lead to lower energy cost for private households and industrial consumers, but at the same time lead to a decrease in greenhouse gas emissions. This article discusses possible reasons for the slow market diffusion of energy-saving light bulbs and shows that the investment in energy-efficient light bulbs does not necessarily lead to significant cost reductions. Drawing on some illustrative examples, we demonstrate that the use of cheaper incandescent bulbs instead of energy-saving light bulbs can be economically rational in cases of rather low usage times, in which the higher initial purchasing price might only pay off after very long time spans. Furthermore, due to the coexistence with the European Emissions Trading Scheme (ETS), this regulation attains no additional emission reductions beyond those achieved by the ETS alone. We thus conclude that the general ban of incandescent light bulbs is inappropriate and should be abolished by the Commission.

Suggested Citation

  • Frondel, Manuel & Lohmann, Steffen, 2011. "The European Commission's light bulb decree: Another costly regulation?," Energy Policy, Elsevier, vol. 39(6), pages 3177-3181, June.
  • Handle: RePEc:eee:enepol:v:39:y:2011:i:6:p:3177-3181
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    1. Schleich, Joachim & Mills, Bradford & Dütschke, Elisabeth, 2014. "A brighter future? Quantifying the rebound effect in energy efficient lighting," Energy Policy, Elsevier, vol. 72(C), pages 35-42.
    2. Mills, Bradford & Schleich, Joachim, 2014. "Household transitions to energy efficient lighting," Energy Economics, Elsevier, vol. 46(C), pages 151-160.
    3. Achim Voß, 2015. "How Disagreement About Social Costs Leads to Inefficient Energy-Productivity Investment," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 60(4), pages 521-548, April.
    4. Roger Fouquet & Peter J.G. Pearson, 2012. "The Long Run Demand for Lighting:Elasticities and Rebound Effects in Different Phases of Economic Development," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 1).
    5. Frondel, Manuel & Schmidt, Christoph M. & aus dem Moore, Nils, 2012. "Marktwirtschaftliche Energiewende: Ein Wettbewerbsrahmen für die Stromversorgung mit alternativen Technologien. Ein Projekt im Auftrag der Initiative Neue Soziale Marktwirtschaft," RWI Projektberichte, RWI - Leibniz-Institut für Wirtschaftsforschung, number 69954, September.
    6. Achim Voss, 2019. "The Adverse Effect of Energy-Efficiency Policy," Working Papers 2019.13, Fondazione Eni Enrico Mattei.
    7. Lo, Kevin & Wang, Mark Y., 2013. "Energy conservation in China’s Twelfth Five-Year Plan period: Continuation or paradigm shift?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 18(C), pages 499-507.
    8. Chitnis, Mona & Sorrell, Steve & Druckman, Angela & Firth, Steven K. & Jackson, Tim, 2013. "Turning lights into flights: Estimating direct and indirect rebound effects for UK households," Energy Policy, Elsevier, vol. 55(C), pages 234-250.

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    More about this item

    Keywords

    Energy efficiency Rebound effect Energy conservation paradox;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices

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