Fuel poverty policy: Go big or go home insulation

Rohan Best and Kompal Sinha

Energy Economics, 2021, vol. 97, issue C

Abstract: Using the Residential Energy Consumption Survey (RECS) data for 2005 and 2015, we quantify key factors contributing to fuel poverty dimensions in the United States. Our results suggest some differences in explanations for two key fuel-poverty dimensions of unaffordability and inadequacy. Explanatory variables with positive associations with the unaffordability aspect include binary variables for renting and vulnerability signalled by prior receipt of energy assistance. Education and dwelling insulation are negatively associated with unaffordability aspects of fuel poverty. Solar panels might also be beneficial in this context. Insulation and prior receipt of energy assistance have consistent associations across both the unaffordability and inadequacy aspects of fuel poverty. We find no evidence of an association of renting or education with the inadequacy aspect of fuel poverty, in contrast to the case for the unaffordability aspect. Our results suggest that a policy providing small-scale assistance is not likely to substantially improve fuel poverty outcomes. However, a greater focus on home insulation and other big investments such as solar panels could be a more effective and transformative policy alternative.

Keywords: Fuel poverty; Insulation; Solar; Rent; Average treatment effect; Entropy balancing (search for similar items in EconPapers)
JEL-codes: D10 I32 Q40 Q48 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:97:y:2021:i:c:s0140988321001006

DOI: 10.1016/j.eneco.2021.105195

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