 Income targeting in consumer energy efficiency programsNathan W. Chan and Isla Globus-Harris Energy Economics, 2025, vol. 143, issue C Abstract: Consumer energy efficiency programs are common around the world, and they frequently include some form of income-based targeting, whether intentional or not. In this paper, we ask: What are the environmental and welfare impacts of income-based targeting in consumer energy efficiency programs? To that end, we present a model with high- and low-income consumers, and we analyze how income targeting affects consumer welfare, distribution, and input (fuel) externalities. We derive a number of policy-relevant expressions that illuminate how initial appliance stocks, energy service demand levels, and demand responsiveness underpin these welfare impacts, and we analyze how these expressions differ across various real-world applications. We furthermore illustrate core trade-offs using two simulations. We offer actionable and easy-to-implement guidance to policymakers and program managers considering income targeting provisions. Keywords: Energy efficiency; Targeting; Energy policy; Externalities; Distribution; Demand-side management (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:143:y:2025:i:c:s0140988325000726 DOI: 10.1016/j.eneco.2025.108249 Access Statistics for this article Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant More articles in Energy Economics from Elsevier |
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