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Cash for Coolers

Author

Listed:
  • Lucas W. Davis
  • Alan Fuchs
  • Paul J. Gertler

Abstract

This paper examines a large-scale appliance replacement program in Mexico that since 2009 has helped 1.5 million households replace their old refrigerators and air-conditioners with energy-efficient models. Using household-level electric billing records from the population of Mexican residential customers we find that refrigerator replacement reduces electricity consumption by an average of 11 kilowatt hours per month, about a 7% decrease. We find that air conditioning replacement, in contrast, increases electricity consumption by an average of 6 kilowatt hours per month, with larger increases during the summer. To put these results in context we present a simple conceptual framework in which energy-efficient durable goods cost less to operate, so households use them more. This behavioral response, sometimes called the "rebound" effect, is important for air-conditioners, but not important for refrigerators.

Suggested Citation

  • Lucas W. Davis & Alan Fuchs & Paul J. Gertler, 2012. "Cash for Coolers," NBER Working Papers 18044, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:18044
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    References listed on IDEAS

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    1. Air conditioners on the rebound
      by Economic Logician in Economic Logic on 2012-05-23 19:54:00

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    Cited by:

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    3. Oliveira, Mario Henrique da Fonseca & Rebelatto, Daisy Aparecida do Nascimento, 2015. "The evaluation of electric energy consumption in the Brazilian residential sector: A technological improvement proposal in order to increase its efficiency," Renewable and Sustainable Energy Reviews, Elsevier, vol. 49(C), pages 836-844.
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    5. Anil Markandya & Xavier Labandeira & Ana Ramos, 2013. "Policy Instruments to Foster Energy Efficiency," Working Papers 01-2014, Economics for Energy.
    6. Michael Greenstone & B. Kelsey Jack, 2013. "Envirodevonomics: A Research Agenda for a Young Field," NBER Working Papers 19426, National Bureau of Economic Research, Inc.
    7. Cravioto, Jordi & Yamasue, Eiji & Okumura, Hideyuki & Ishihara, Keiichi N., 2014. "Energy service satisfaction in two Mexican communities: A study on demographic, household, equipment and energy related predictors," Energy Policy, Elsevier, vol. 73(C), pages 110-126.
    8. Thomas, Brinda A. & Azevedo, Inês L., 2013. "Estimating direct and indirect rebound effects for U.S. households with input–output analysis Part 1: Theoretical framework," Ecological Economics, Elsevier, vol. 86(C), pages 199-210.
    9. Ponce de Leon Barido, Diego & Suffian, Stephen & Kammen, Daniel M. & Callaway, Duncan, 2018. "Opportunities for behavioral energy efficiency and flexible demand in data-limited low-carbon resource constrained environments," Applied Energy, Elsevier, vol. 228(C), pages 512-523.

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    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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