Effects of EPC Home Energy Audits on Investment: A Quasi-Natural Experiment Approach

27 Pages Posted: 17 Oct 2018

See all articles by CERE Center for Environmental and Resource Economics

CERE Center for Environmental and Resource Economics

CERE

Alejandro Egüez

University of Umea - Centre for Environmental and Resource Economics

Andrius Kažukauskas

Swedish University of Agricultural Sciences (SLU) - Center for Environmental and Resource Economics (CERE)

Date Written: September 26, 2018

Abstract

Incomplete information may be one reason why some households do not invest in energy efficiency even though it would benefit them to do so. Energy performance certificates (EPCs) have been promoted to overcome such information shortages. In this paper, we investigate whether EPCs together with mandatory home energy audits make households more likely to invest in energy efficiency. Our study takes advantage of the mandatory nature of the EPCs to avoid the potential selection bias problem that typically applies to studies using voluntary energy audits as the treatment. Our treatment group consists of single-household dwellings in Sweden sold from 2008, i.e., when EPCs became legally required in connection with sales of residential buildings, to 2015; while the control group consists of houses sold between 2002 and 2008, i.e., without an EPC. The results show that there is no statistically significant treatment effect for most of the measures that a household can take to improve the energy performance of their house.

Keywords: energy performance certificate (EPC), home energy audits, quasi-natural experimental design, incomplete information, investment decision, energy efficiency gap, policy evaluation

JEL Classification: Q41, Q48, D83

Suggested Citation

Center for Environmental and Resource Economics, CERE and Egüez, Alejandro and Kažukauskas, Andrius, Effects of EPC Home Energy Audits on Investment: A Quasi-Natural Experiment Approach (September 26, 2018). CERE Working Paper, 2018:8, Available at SSRN: https://ssrn.com/abstract=3255891 or http://dx.doi.org/10.2139/ssrn.3255891

Alejandro Egüez

University of Umea - Centre for Environmental and Resource Economics ( email )

Umeå, S-901 87
Sweden

Andrius Kažukauskas

Swedish University of Agricultural Sciences (SLU) - Center for Environmental and Resource Economics (CERE) ( email )

Almas Allé 10
Umeå, 750 07
Sweden

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