The Light and the Heat: Productivity Co-Benefits of Energy-Saving Technology

Achyuta Adhvaryu, Namrata Kala and Anant Nyshadham
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Achyuta Adhvaryu: University of Michigan, NBER, BREAD, and Good Business Lab
Namrata Kala: MIT Sloan School of Management, BREAD, NBER, and JPAL

The Review of Economics and Statistics, 2020, vol. 102, issue 4, 779-792

Abstract: We study the adoption of energy-efficient LED lighting in garment factories around Bangalore, India. Combining daily production line–level data with weather data, we estimate a negative, nonlinear productivity-temperature gradient. We find that LED lighting raises productivity on hot days. Using the firm's costs data, we estimate that the payback period for LED adoption is less than one-third the length after accounting for productivity co-benefits. The average factory in our data gains about $2,880 in power consumption savings and about $7,500 in productivity gains.

Date: 2020
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Working Paper: The Light and the Heat: Productivity Co-benefits of Energy-saving Technology (2018)
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