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Putting a new 'spin' on energy labels: measuring the impact of reframing energy efficiency on tumble dryer choices in a multi-country experiment

Author

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  • Stefano Ceolotto

    (Department of Economics, Trinity College Dublin)

  • Eleanor Denny

    (Department of Economics, Trinity College Dublin)

Abstract

It has been shown that individuals often underinvest in energy efficiency despite net benefits over the longer term. One possible explanation is that agents do not understand and/or cannot interpret energy information when provided in physical units, as in most energy efficiency labels. Prior studies have investigated the effect of reframing energy information reported on energy labels into monetary units. Outcomes are mixed, and it is not clear whether this is due to the use of different products, different methods or because studies were conducted in different countries with different energy prices and labelling standards. This paper overcomes that ambiguity by testing the effect of alternative ways to provide energy consumption information using the same experiment in a multi-country setting. Results show that the specific national context in which an intervention is implemented is a key determinant of its effectiveness. Personalised energy expenditures increase the willingness-to-pay for energy efficiency in the United Kingdom, whereas monetary information has a negative impact in Canada. No significant effect is detected in Ireland and the United States. In addition, it seems that providing monetary information crowds out individuals who would buy a more efficient product for environmental reasons.

Suggested Citation

  • Stefano Ceolotto & Eleanor Denny, 2021. "Putting a new 'spin' on energy labels: measuring the impact of reframing energy efficiency on tumble dryer choices in a multi-country experiment," Trinity Economics Papers tep1521, Trinity College Dublin, Department of Economics.
    • Handle: RePEc:tcd:tcduee:tep1521
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    References listed on IDEAS

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    More about this item

    Keywords

    Energy Efficiency Labels; Discrete Choice Experiment; Tumble dryers; Framing Effect;
    All these keywords.

    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q49 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Other
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • D10 - Microeconomics - - Household Behavior - - - General
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General

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