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Effects of construction activities on residential electricity consumption: Evidence from Singapore's public housing estates

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  • Agarwal, Sumit
  • Satyanarain, Rengarajan
  • Sing, Tien Foo
  • Vollmer, Derek

Abstract

This study aims to empirically test the effects of negative environmental externalities (i.e. noise pollution) due to construction activities within half to one kilometer (km) radius and how households react to such externalities by increasing the use of air-conditioners to mitigate noise from the construction work. We use a unique dataset of electricity consumption by public housing residents in Singapore measured at the building level and merge it with the dataset of construction sites for the periods from 2009 to 2011. Using a difference-in-differences approach, we find that electricity consumption by the households living close to the construction sites increases by 6% compared to the households who are not affected by noises from construction sites during the construction periods, after controlling for building and month of the year fixed effects. The results remain robust after controlling for spatial autocorrelated lag and error terms. The economic cost of the construction externalities for each household amounts to approximately S$98 per annum. We also find that the increases in electricity consumption of the affected households were persistent, and the electricity consumption of the affected households did not revert to the pre-construction levels, after the removal of the negative externality.

Suggested Citation

  • Agarwal, Sumit & Satyanarain, Rengarajan & Sing, Tien Foo & Vollmer, Derek, 2016. "Effects of construction activities on residential electricity consumption: Evidence from Singapore's public housing estates," Energy Economics, Elsevier, vol. 55(C), pages 101-111.
    • Handle: RePEc:eee:eneeco:v:55:y:2016:i:c:p:101-111
    DOI: 10.1016/j.eneco.2016.01.010
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    3. Bon-Gang Hwang & Ming Shan & Helena Phua & Seokho Chi, 2017. "An Exploratory Analysis of Risks in Green Residential Building Construction Projects: The Case of Singapore," Sustainability, MDPI, vol. 9(7), pages 1-21, June.
    4. Bhati, Abhishek & Hansen, Michael & Chan, Ching Man, 2017. "Energy conservation through smart homes in a smart city: A lesson for Singapore households," Energy Policy, Elsevier, vol. 104(C), pages 230-239.
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    More about this item

    Keywords

    Electricity Consumption; Negative Externalities; Construction Activities; Public Housing; Demand for Comfort;
    All these keywords.

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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