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Consumers' Response to State Energy Efficient Appliance Rebate Programs

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  • Sébastien Houde
  • Joseph E. Aldy

Abstract

Through an evaluation of the 2009 Recovery Act's State Energy Efficient Appliance Rebate Program, this paper examines consumers' response to energy efficiency rebates. The analysis shows that 70 percent of consumers claiming a rebate were inframarginal and an additional 15 percent-20 percent of consumers simply delayed their purchases by a few weeks. Consumers responded to rebates by upgrading to higher quality, but less energy-efficient models. Overall the impact of the program on long-term energy demand is likely to be small. Measures of government expenditure per unit of energy saved are an order of magnitude higher than estimates for other energy efficiency programs.

Suggested Citation

  • Sébastien Houde & Joseph E. Aldy, 2017. "Consumers' Response to State Energy Efficient Appliance Rebate Programs," American Economic Journal: Economic Policy, American Economic Association, vol. 9(4), pages 227-255, November.
    • Handle: RePEc:aea:aejpol:v:9:y:2017:i:4:p:227-55
    Note: DOI: 10.1257/pol.20140383
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    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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