NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Cash for Coolers

Lucas W. Davis, Alan Fuchs, Paul J. Gertler

NBER Working Paper No. 18044
Issued in May 2012
NBER Program(s):   EEE

This paper examines a large-scale appliance replacement program in Mexico that since 2009 has helped 1.5 million households replace their old refrigerators and air-conditioners with energy-efficient models. Using household-level electric billing records from the population of Mexican residential customers we find that refrigerator replacement reduces electricity consumption by an average of 11 kilowatt hours per month, about a 7% decrease. We find that air conditioning replacement, in contrast, increases electricity consumption by an average of 6 kilowatt hours per month, with larger increases during the summer. To put these results in context we present a simple conceptual framework in which energy-efficient durable goods cost less to operate, so households use them more. This behavioral response, sometimes called the “rebound” effect, is important for air-conditioners, but not important for refrigerators.

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Document Object Identifier (DOI): 10.3386/w18044

Cash for Coolers: Evaluating a Large-Scale Appliance Replacement Program in Mexico” (with Alan Fuchs and Paul Gertler), American Economic Journal: Economic Policy, forthcoming.

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