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Does Daylight Saving Time Save Energy? Evidence from a Natural Experiment in Indiana

Author

Listed:
  • Matthew J. Kotchen

    (Yale University and NBER)

  • Laura E. Grant

    (University of California, Santa Barbara)

Abstract

We take advantage of a natural experiment in the state of Indiana to estimate the effect of daylight saving time (DST) on residential electricity consumption. Our main finding is that, contrary to the policy's intent, DST increases electricity demand. The findings are consistent with simulation results that identify a trade-off between reducing demand for lighting and increasing demand for heating and cooling. We estimate a cost to Indiana households of $9 million per year in increased electricity bills. We also estimate social costs of increased pollution emissions between $1.7 to $5.5 million per year. © 2011 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Suggested Citation

  • Matthew J. Kotchen & Laura E. Grant, 2011. "Does Daylight Saving Time Save Energy? Evidence from a Natural Experiment in Indiana," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1172-1185, November.
    • Handle: RePEc:tpr:restat:v:93:y:2011:i:4:p:1172-1185
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    JEL classification:

    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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