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Assessing the effects of a large temporary energy savings program: Evidence from a developing country

Cristian Huse, Claudio Lucinda and Andre Ribeiro

Journal of Environmental Economics and Management, 2021, vol. 110, issue C

Abstract: We examine the effects of a large temporary energy-savings program on the valuation of energy efficiency by Brazilian households, as well as its counterfactual energy savings. Using a representative sample of Brazilian households, we specify and estimate a structural model of appliance choice and document that (i) the program only increases the valuations of households facing incentives in the form of an energy consumption quota introduced by the program; (ii) the effect of incentives dominates other components of the energy efficiency gap; (iii) the effect of the program on valuations is temporary, with these essentially reverting to prior levels after the end of the program; (iv) heterogeneity in valuations is prevalent; (v) focusing only on the purchase of new refrigerators, the counterfactual energy savings are non-trivial, being equivalent to the yearly electricity consumption of a city with 1.15 mn inhabitants. The findings suggest that short-lived reactions to temporary programs on the extensive margin are non-trivial and have log-run implications via the purchase of durables.

Keywords: Energy efficiency; Energy paradox; Energy efficiency gap; Electricity demand; Household appliance (search for similar items in EconPapers)
JEL-codes: D12 D83 L15 L68 Q48 (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1016/j.jeem.2021.102529

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Journal of Environmental Economics and Management is currently edited by M.A. Cole, A. Lange, D.J. Phaneuf, D. Popp, M.J. Roberts, M.D. Smith, C. Timmins, Q. Weninger and A.J. Yates

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