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Watt’s it Worth? Residential Energy Efficiency Premiums

Author

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  • Ortega-McCormack, Hannah

    (Central Bank of Ireland)

  • Carroll, James

    (Central Bank of Ireland)

  • Gillespie, Tom

    (Central Bank of Ireland)

  • Lyons, Ronan C.

    (Central Bank of Ireland)

Abstract

The Energy Efficiency Premium (hereafter called the premium) - that is, the increase in property price associated with a single grade increase in the BER rating - was on average 1.6% between 2015 and 2024. The premium decreased from 1.9% in 2015 to 1.3% in 2024. In 2024, 59% of properties for sale in Daft had a BER ranging from B3 to D1. If a property were to improve its BER from a D1-rating to a B3-rating, the four BER-grade difference would amount to a premium of 5.2%. The change in the premium over time differs by market segment. The premium is highest for lower-priced properties. However, the premiums converged over the ten years, decreasing for lower-priced properties and rising for higher-priced properties, potentially driven by higher-income households having greater capacity to prioritise energy efficiency.

Suggested Citation

  • Ortega-McCormack, Hannah & Carroll, James & Gillespie, Tom & Lyons, Ronan C., 2026. "Watt’s it Worth? Residential Energy Efficiency Premiums," Central Bank Staff Insights 11/SI/26, Central Bank of Ireland.
    • Handle: RePEc:cbi:stafin:11/si/26
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    File URL: https://www.centralbank.ie/publication/research-publications/staff-insights/residential-energy-efficiency-premiums
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