REBOUND EFFECT FOR UK RESIDENTIAL SECTOR
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1 REBOUND EFFECT FOR UK RESIDENTIAL SECTOR IAEE Confeence, Sngapoe, June 18-21, 2017 Mona Chtns (Unvesty of Suey) Roge Fouquet (LSE) Steve Soell (Unvesty of Sussex)
2 Outlne Rebound mechansms Data ovevew Model Results Dscusson
3 Rebound mechansms fo households Total Rebound=Dect Rebound+Indect Rebound Indect Rebound Lowe heatng cost and fuel blls Lghtng Moe o less emssons Less emssons Lowe unnng cost fo heatng Hghe oom tempeatue o leavng the heatng on fo longe Dect Rebound Moe emssons
4 Measung enegy sevce pce and Consumpton Data Souces (e.g. DECC, ONS) p E Enegy Pce (e.g. pence pe kwh) Enegy Effcency (e.g. lumen-hous pe kwh) E Enegy Consumpton (e.g. TWh fo lghtng) p S pe / Enegy Sevce Pce (e.g. pe lumen-hou) S E Enegy Sevce Consumpton (e.g. mllons of lumen-hous)
5 Enegy sevces n ths pesentaton Lghtng Heatng Wet and cold applances Othe applances Cookng Ca tanspot 5
6 Lghtng, Heatng, Wet & cold, Cookng, Ca (1964=100) Othe applances Aveage effcency by enegy sevce n the UK (ndex, 1964=100) 600% 1200% 500% 1000% 400% 800% 300% 600% 200% 400% 100% 200% 0% 0% Lghtng Heatng Wet & cold applances Cookng Ca tanspot Othe applances 6
7 Real pce of enegy sevces (ndex, 1964=100) Lghtng, Heatng, We & cold, Cookng, Ca (Index 1964=100) Lghtng and applances, Cookng, Ca (Index 1964=100) Heatng Othe applances ( ndex 1964=100) Lghtng Heatng Cookng Othe Applances Wet & cold applances Ca tanspot Real pce of enegy fo sevces (ndex, 1964=100) Lghtng and Applances Cookng Ca tanspot Heatng 7
8 Lghtng, Heatng, Wet & cold, Cookng, Ca (ndex 1964=100) Lghtng, Wet & cold, Cookng, Heatng, Ca (ndex=1964=100) Othe applances Lghtng Wet & cold applances Cookng Heatng Ca tanspot Othe applances Othe applances Consumpton of enegy sevces pe equvalsed peson (ndex, 1964=100) Enegy consumpton pe equvalsed peson (ndex, 1964=100) Lghtng Wet & cold applances Heatng Cookng Ca tanspot Othe applances
9 Total ebound estmaton (n tems of CO2) Total Rebound = whee: ps ps ( s ) u u x x s w w s ( s ) ps ps Dect ( s ) Indect : own-pce elastcty of sevce s ( ) : coss-pce elastcty of sevce wth espect to sevce s u : CO2 ntensty of sevce u s : CO2 ntensty of sevce s w : budget shae of sevce w s : budget shae of sevce s ( )
10 Two stage budgetng model Household expendtue Stage 1 Enegy sevces Tanspot Othe goods and sevces Lghtng Ca Stage 2 Heatng Othe tanspot Wet and cold applances Othe applances Cookng
11 Almost Ideal Demand System (AIDS) Stage 1: w t whee: z w =budget shae of categoy P z =pce of categoy z x=total expendtue pe equvalsed peson zt P=Laspeyes-lke pce ndex j ln p ln( ln P x t L t / P ) t w 0 ln z p t w z z t1 t t, z: 1, 2, 3 Addng up: Symmety: Homogenety: 1, 0, 0 0 z, z z z 0 z
12 Almost Ideal Demand System (AIDS) Stage 2: w ln p ln( x / P ) w t t t whee: j w =budget shae of sevce P j =pce of sevce j j jt ln P L t t w 0 t ln p t x =total expendtue on sevces pe equvalsed peson P =Laspeyes-lke pce ndex j j j 1 t, j: 1,, 4 Addng up: Symmety: Homogenety: 1, 0, j 0, j 0 j j j 0 1
13 Elastctes fo two-stage budgetng model Combned elastctes of stages 1 and 2 to obtan total pce and expendtue elastctes fo each enegy and tanspot sevce (Edgeton 1997). Wthn goup elastctes: Income elastcty Uncompensated pce elastcty Total/between goup elastctes: Income elastcty E e E E z 1 w z w w ( ) E z z s: Konecke s delta equal to one when =s and zeo elsewhee. Uncompensated pce elastcty e j ze( )j E( )w( z ) j [ z e( )( z ) ] UK household annual tme sees data Iteatve Seemngly Unelated Regessons (ISUR) method fo system estmaton
14 Estmated aveage elastctes Total expendtue elastctes fo enegy sevces Expendtue elastcty Lghtng Heatng Wet & cold applances Othe applances Cookng Ca tanspot Total pce elastctes fo enegy sevces Pce elastcty Lghtng Heatng Wet & cold applances Othe applances Cookng Ca tanspot Lghtng Heatng Wet & cold applances Othe applances Cookng Ca tanspot
15 Estmated aveage ebound effects Rebound effects between enegy and tanspot sevces Lghtng Heatng Wet & cold applances Othe applances Cookng Ca tanspot Lghtng 93.6% -39.4% -8.0% -5.1% -3.7% 1.8% Heatng -3.9% 69.6% -5.7% -3.8% -3.9% 1.4% Wet & cold applances -5.5% -39.3% 92.2% -5.2% -5.2% 1.8% Othe applance -7.0% -35.6% -8.3% 93.9% -5.7% 2.0% Cookng -3.6% -42.7% -8.0% -5.5% 91.7% 1.9% Ca tanspot 0.7% 9.7% 1.4% 0.7% 0.6% 54.2% Dect, ndect and total ebound effects fo enegy and tanspot sevces Dect ebound Indect ebound (enegy and tanspot sevces only) Total ebound Lghtng 93.6% -54.3% 39.31% Heatng 69.6% -15.9% 53.68% Wet & cold applances 92.2% -53.3% 38.92% Othe applances 94.0% -54.5% 39.40% Cookng 91.7% -57.8% 33.91% Ca tanspot 54.2% 13.1% 67.26%
16 Dscusson Data assumptons and lmtatons No backfe, but ebound s not neglgble and should not be neglected Indect ebound plays an mpotant ole Captal cost s wthn the expendtue on othe goods and sevce/othe tanspot categoes Indect ebound of non-enegy goods s neglected Aveage ebound ove the sample peod ebound ove the sample peod Compason wth ebound based on enegy/tanspot fuel demand
17 REBOUND EFFECT FOR UK RESIDENTIAL SECTOR IAEE Confeence, Sngapoe, June 18-21, 2017 Mona Chtns (Unvesty of Suey) Roge Fouquet (LSE) Steve Soell (Unvesty of Sussex)
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