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Do Energy Efficiency Networks Save Energy? Evidence from German Plant-Level Data

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  • Jan Stede

Abstract

In energy efficiency networks, groups of firms exchange experiences on energy conservation in regular meetings over several years. The companies implement energy efficiency measures in order to reach commonly agreed energy savings and CO2 reduction goals. Existing evaluations of such voluntary regional networks claim that participants improved energy efficiency at twice the speed of the industry average. Based on comprehensive data from the German manufacturing census, this paper shows that this claim is overstated: Likely less than half of energy savings credited to the networks are additional, implying that more than 2.5 million tonnes of CO2 counted towards national energy efficiency goals would have to be compensated by additional policies. However, although statistically insignificant, estimates of the network effects are still substantial, pointing to 1,400 MWh of energy savings and 600 tonnes of CO2 reduction for the average participant. These estimates suggest a high cost-effectiveness of energy efficiency networks compared to similar energy efficiency policies, even if actual energy savings are likely lower than previous research suggested.

Suggested Citation

  • Jan Stede, 2019. "Do Energy Efficiency Networks Save Energy? Evidence from German Plant-Level Data," Discussion Papers of DIW Berlin 1813, DIW Berlin, German Institute for Economic Research.
    • Handle: RePEc:diw:diwwpp:dp1813
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    1. Claudio F. Carpio & Marina Yesica Recalde, 2021. "Learning energy efficiency networks in Latin America: Lessons learned from the Argentinean case," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 10(3), May.

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    More about this item

    Keywords

    Business networks; voluntary agreements; energy conservation; policy evaluation;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General

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