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Energy Rebound Due to Re-spending. A Growing Concern

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  • Miklós Antal

    (WIFO)

  • Jeroen C.J.M. van den Bergh

Abstract

Energy conservation is widely accepted as an important strategy to combat climate change. It can, nevertheless, stimulate new energy uses that partly offset the original savings. This is known as rebound. One particular rebound mechanism is re-spending of money savings associated with energy savings on energy intensive goods or services. We calculate the average magnitude of this "re-spending rebound" for different fuels and countries. We find that emerging economies, neglected in past studies, typically have substantially larger rebounds than OECD countries. The effect is generally stronger for gasoline than for natural gas and electricity. Paradoxically, strengthening financial incentives to conserve energy tends to increase rebound. This is expected to gain importance with climate regulation and peak oil. We discuss the policy implications of our findings.

Suggested Citation

  • Miklós Antal & Jeroen C.J.M. van den Bergh, 2014. "Energy Rebound Due to Re-spending. A Growing Concern," WIFO Working Papers 463, WIFO.
    • Handle: RePEc:wfo:wpaper:y:2014:i:463
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    File URL: https://www.wifo.ac.at/wwa/pubid/47140
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    References listed on IDEAS

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    1. Hans-Werner Sinn, 2008. "Public policies against global warming: a supply side approach," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 15(4), pages 360-394, August.
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    3. Jeroen Bergh, 2011. "Energy Conservation More Effective With Rebound Policy," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 48(1), pages 43-58, January.
    4. Schipper, Lee & Grubb, Michael, 2000. "On the rebound? Feedback between energy intensities and energy uses in IEA countries," Energy Policy, Elsevier, vol. 28(6-7), pages 367-388, June.
    5. Webster, Mort & Paltsev, Sergey & Reilly, John, 2008. "Autonomous efficiency improvement or income elasticity of energy demand: Does it matter?," Energy Economics, Elsevier, vol. 30(6), pages 2785-2798, November.
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    Cited by:

    1. Karl Aiginger, 2016. "New Dynamics for Europe: Reaping the Benefits of Socio-ecological Transition – Part I: Synthesis. WWWforEurope Deliverable No. 11," WIFO Studies, WIFO, number 58791.
    2. Ina Meyer & Mark Sommer, 2014. "Employment Effects of Renewable Energy Supply – A Meta Analysis. WWWforEurope Policy Paper No. 12," WIFO Studies, WIFO, number 47225.
    3. Georg Licht & Bettina Peters & Christian Köhler & Franz Schwiebacher, 2014. "The Potential Contribution of Innovation Systems to Socio-Ecological Transition. WWWforEurope Deliverable No. 4," WIFO Studies, WIFO, number 47502.

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    Keywords

    emerging economies; re-spending; rebound effect;
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