Investment in Energy Efficiency, Adoption of Renewable Energy and Household Behaviour: Evidence from OECD countries

摘要

There are possible synergies between the decision to invest in energy efficiencymeasures and to adopt renewable energy, in the sense that the former reducesenergy demand so that the latter can further cut future greenhouse gas (GHG)emissions, and which has great potential in the residential sector. Much work hasbeen done in the residential sector on demand for clean energy and on investmentin energy efficiency, but to our knowledge there is no specific study that investigatesthe interaction between the two. This paper fills a gap in the literature, and firstshows theoretically that there are interactions between the two decisions dependingon the threshold of the cross effect related to the environmental motivation of theconsumer. Second, the paper empirically shows that the two decisions are positivelyinterrelated and cannot be estimated independently. As a result, univariatemethods that estimate the decision to adopt renewable energy and investment inenergy efficiency separately may produce inefficient results, because there may beunobserved characteristics that determine both decisions. Third, the paper investigateshousehold characteristics that significantly affect the interaction betweenthe two decisions using a generalised ordered logit model. Specifically, the paperprovides evidence of factors that affect the joint probability of adopting renewableenergy and investing in energy efficiency, and the probability of doing nothing. Thiscontribution can serve to define incentive policies to advance the energy transition.