Estimating the price premium of high energy-efficient washing-machines in Spain: A hedonic approach

Elena López-Bernabé and Amaia de Ayala and Ibon Galarraga

No 2022-01, Working Papers from BC3

Abstract: Household appliances account for a considerable proportion of residential electricity consumption, and are therefore an important focus for energy-saving efforts. Energy- efficiency labels for appliances are a key instrument in providing information on the energy-efficiency level of an appliance and promoting the purchase of the most energy-efficient ones. This paper applies the hedonic price method to estimate the price premium paid for energy efficiency in the washing machines market in Spain. We find that consumers actually pay a price premium of 11% for high energy-efficiency washing machines compared to machines with the same characteristics but lower energy efficiency. This accounts for about €67 in the average market price of washing machines in Spain. This price premium in Spain seems to have increased by more than 5% from 2012 to 2019. Our analysis also shows that other specific attributes such as brand, place sold, spin-drying performance and built-in washing machines are very important in purchasing decision-making.

Keywords: Hedonic price model; Energy-efficiency label; Household appliances (washing machine). (search for similar items in EconPapers)
Date: 2022-01
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