NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Do Energy Efficiency Investments Deliver? Evidence from the Weatherization Assistance Program

Meredith Fowlie, Michael Greenstone, Catherine Wolfram

NBER Working Paper No. 21331
Issued in July 2015
NBER Program(s):   EEE

Conventional wisdom suggests that energy efficiency (EE) policies are beneficial because they induce investments that pay for themselves and lead to emissions reductions. However, this belief is primarily based on projections from engineering models. This paper reports on the results of an experimental evaluation of the nation’s largest residential EE program conducted on a sample of more than 30,000 households. The findings suggest that the upfront investment costs are about twice the actual energy savings. Further, the model-projected savings are roughly 2.5 times the actual savings. While this might be attributed to the “rebound” effect – when demand for energy end uses increases as a result of greater efficiency – the paper fails to find evidence of significantly higher indoor temperatures at weatherized homes. Even when accounting for the broader societal benefits of energy efficiency investments, the costs still substantially outweigh the benefits; the average rate of return is approximately -9.5% annually.

You may purchase this paper on-line in .pdf format from SSRN.com ($5) for electronic delivery.

Information about Free Papers

You should expect a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.

E-mail:

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w21331

Users who downloaded this paper also downloaded these:
Levinson w20797 How Much Energy Do Building Energy Codes Really Save? Evidence from California
Borenstein and Bushnell w21113 The U.S. Electricity Industry After 20 Years of Restructuring
Anderson, Kellogg, and Salant w20280 Hotelling Under Pressure
Bushnell, Holland, Hughes, and Knittel w21259 Strategic Policy Choice in State-Level Regulation: The EPA's Clean Power Plan
Davis and Metcalf w20720 Does Better Information Lead to Better Choices? Evidence from Energy-Efficiency Labels
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us