Rebound Effect in Energy Efficient Appliance Adopting Households

Abstract

This paper uses data from smart meter technology to estimate the occurrence of energy rebound, a “substitution” and “income’ effect where the price-per-use of an appliance falls relative to its energy efficiency. This causes households to have more income that they could potentially use to increase their appliance use, cutting their true energy savings. Smart meter readings are provided by Pecan Street Incorporated and provide minute level energy use for a household’s washing machine. This data grants the ability to count actual laundry loads of a household from observing when washing machines energy consumption changes from zero to positive. Utilizing a treatment effect created by a partnership with LG and Pecan Street Inc. to provide select households with energy efficient washer and dryers, I estimate that load rebound is not statistically different from zero with the upper bound of a 95% confidence interval that households would at most increase their loads of laundry by 20%. Likewise, I estimate energy rebound to be not statistically different from zero with a 95% confidence interval of -20 to 80 kilowatt-hours for a household month.