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Measuring energy efficiency and rebound effects using a stochastic demand frontier approach: the US residential energy demand

Luis Orea, Manuel Llorca and Massimo Filippini

No 2014/01, Efficiency Series Papers from University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG)

Abstract: This paper brings attention to the fact that the energy demand frontier model introduced by Filippini and Hunt (2011, 2012) is closely connected to the measurement of the so-called rebound effect associated with improvements in energy efficiency. In particular, we show that their model implicitly imposes a zero rebound effect, which contradicts most of the available empirical evidence on this issue. We relax this restrictive assumption through the modelling of a rebound-effect function that mitigates or intensifies the effect of an efficiency improvement on energy consumption. We illustrate our model with an empirical application that aims to estimate a US frontier residential aggregate energy demand function using panel data for 48 states over the period 1995 to 2011.

Keywords: US residential energy demand; efficiency and frontier analysis; state energy efficiency; rebound effect (search for similar items in EconPapers)
JEL-codes: C5 Q4 Q5 (search for similar items in EconPapers)
Pages: 29
Date: 2014
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Citations: View citations in EconPapers (3)

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