Setting the Standard: Commercial Electricity Consumption Responses to Energy Codes

Maya M. Papineau ()
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Maya M. Papineau: Department of Economics, Carleton University, http://carleton.ca/economics/people/papineau-maya-m/

No 15-05, Carleton Economic Papers from Carleton University, Department of Economics

Abstract: While green-labeled buildings have been found to sell at a premium compared to nearby controls with similar observable characteristics, the voluntary nature of the labeling decision implies green-labeled buildings may have different unmeasured characteristics that may account for at least a portion of the premium. Therefore, it is unclear whether green-labeled building premiums are a causal effect of the labels. I use data on repeat sales transactions and detailed hedonic characteristics to test whether green-labeled office buildings were selling at a premium before they were labeled, and combine these results with post-labeling price premium estimates to identify realized cost-benefit ratios for green-labeling policies. The data suggest the causal net benefits of green labels range from $11.50-$19.95 per square foot. The estimated net benefits are smaller than previous estimates that have focused solely on the benefits and ignored the potential biases from nonrandom selection.

Keywords: Green Labels; Nonresidential Real Estate; Cost-Benefit Analysis (search for similar items in EconPapers)
JEL-codes: D61 Q48 R33 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2015-05-06
New Economics Papers: this item is included in nep-ene and nep-reg
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Published: Carleton Economic Papers

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