Eleftherios Giovanis (University of Verona) on "The Causal Effect of Investing in Energy Efficiency Innovations on Energy Consumption and Carbon Dioxide Emissions: Do Energy Policies Matter?"

Speaker:  Eleftherios Giovanis - University of Verona
  Wednesday, June 15, 2016 at 12:30 PM Polo Santa Marta, Via Cantarane 24, Stanza 1.59
Household energy consumption plays a large role in determining the greenhouse gas emissions expressed by carbon dioxide (CO2) emissions of a country. Estimates show that the total energy consumed by households, can amount to 70-80% of a country’s national energy use and greenhouse gas emissions. Furthermore, in countries with a large import, the household-related CO2 emissions can be more than 100% of the national emissions. The intensive energy consumption of households and its harmful effects on the environment in general has led to focus on household energy efficiency and conservation behaviours. These behaviours refer to energy efficiency innovations/ energy conservation investment decisions related to dwelling modifications, such as installation of wind turbines, insulation of walls and lofts, installation of heating controls and replacement of heater and coolers. First, the study examines the determinants of the decisions of households in England on energy innovation investment and energy use. The second aim of the study is to explore the energy policy “Warm Front Scheme” which covers grants for loft insulation, cavity wall insulation, new boiler and heating controls, fitting gas room heaters with thermostat controls, hot water tank insulation,  conversion of a solid fuel open fire to a glass front fire, new central heating systems. The grant reaches the value of £3,500 per household available or £6,000 if the household is not connected to the gas network. In addition, the eligibility criteria are various. Householders aged 60 or over and  householders who are in receipt of one or more of various benefits, such as income support, council Tax Benefit, Housing Benefit, Job Seekers Allowance, Pension Credit are eligible. Overall, this scheme can be valuable, as for instance upgrades to the wall and loft insulation and heating controls can reduce the energy bills. An inefficient boiler or heater can cost hundreds of pounds every year, thus this grant can be used in order to replace old and inefficient heating systems. Warm Front Scheme increase the income and it is expected the households that receive these grants are more likely to invest in one or some of the energy efficiency measures and innovations mentioned before. Using propensity score matching and regression discontinuity the study examines the causal effects of Warm Front Scheme on households’ decision to invest in energy efficiency measures. Finally, the effects of conservation behaviours/decisions on energy consumption, post-improvement energy efficiency rating and carbon dioxide (CO2) emissions are explored. Overall, depending on the type of the energy efficiency measure, the Warm Front Scheme has a positive effect on post-improvement energy efficiency rating.

Programme Director
Marcella Veronesi

Publication date
January 17, 2016