Increasing Energy Efficiency in Scottish Households

Trading-off Economic Benefits and Energy Rebound Effects?

Research output: Book/ReportOther report

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Abstract

This paper investigates the economy-wide impacts of a 5% improvement in Scottish household energy efficiency, focussing specifically on general equilibrium energy rebound effects, both in household energy use and in total energy use across the Scottish economy. The impacts are measured through simulations using an intertemporal single region computable general equilibrium (CGE) model. Previous studies based on a national case show that improving efficiency in household energy can stimulate the economy through an increase and change in the pattern of the aggregate demand. However, this may put upward pressure on domestic prices, thereby crowding out exports. Here we find that in an open region, interregional migration of workers may give additional momentum to the economic expansion, by relieving pressure on the real wage and the CPI to their baseline values and restoring the lost competitiveness. By considering different simulation scenarios we show that there is a friction between the economic stimulus from increasing household energy efficiency and the rebound effects.
Original languageEnglish
Place of PublicationGlasgow
PublisherUniversity of Strathclyde
Number of pages44
Publication statusPublished - May 2016

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household energy
energy efficiency
Energy efficiency
Economics
Wages
energy use
economics
energy
Momentum
Friction
computable general equilibrium analysis
wage
competitiveness
simulation
momentum
friction
effect
household
economy

Keywords

  • renewable energy policy
  • climate change
  • Scotland
  • UK energy market
  • computable general equilibrium model
  • economy-wide rebound
  • household energy efficiency

Cite this

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title = "Increasing Energy Efficiency in Scottish Households: Trading-off Economic Benefits and Energy Rebound Effects?",
abstract = "This paper investigates the economy-wide impacts of a 5{\%} improvement in Scottish household energy efficiency, focussing specifically on general equilibrium energy rebound effects, both in household energy use and in total energy use across the Scottish economy. The impacts are measured through simulations using an intertemporal single region computable general equilibrium (CGE) model. Previous studies based on a national case show that improving efficiency in household energy can stimulate the economy through an increase and change in the pattern of the aggregate demand. However, this may put upward pressure on domestic prices, thereby crowding out exports. Here we find that in an open region, interregional migration of workers may give additional momentum to the economic expansion, by relieving pressure on the real wage and the CPI to their baseline values and restoring the lost competitiveness. By considering different simulation scenarios we show that there is a friction between the economic stimulus from increasing household energy efficiency and the rebound effects.",
keywords = "renewable energy policy, climate change, Scotland, UK energy market, computable general equilibrium model, economy-wide rebound, household energy efficiency",
author = "Gioele Figus and Karen Turner and Patrizio Lecca and Peter McGregor and Kim Swales",
year = "2016",
month = "5",
language = "English",
publisher = "University of Strathclyde",

}

Increasing Energy Efficiency in Scottish Households : Trading-off Economic Benefits and Energy Rebound Effects? / Figus, Gioele; Turner, Karen; Lecca, Patrizio; McGregor, Peter; Swales, Kim.

Glasgow : University of Strathclyde, 2016. 44 p.

Research output: Book/ReportOther report

TY - BOOK

T1 - Increasing Energy Efficiency in Scottish Households

T2 - Trading-off Economic Benefits and Energy Rebound Effects?

AU - Figus, Gioele

AU - Turner, Karen

AU - Lecca, Patrizio

AU - McGregor, Peter

AU - Swales, Kim

PY - 2016/5

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N2 - This paper investigates the economy-wide impacts of a 5% improvement in Scottish household energy efficiency, focussing specifically on general equilibrium energy rebound effects, both in household energy use and in total energy use across the Scottish economy. The impacts are measured through simulations using an intertemporal single region computable general equilibrium (CGE) model. Previous studies based on a national case show that improving efficiency in household energy can stimulate the economy through an increase and change in the pattern of the aggregate demand. However, this may put upward pressure on domestic prices, thereby crowding out exports. Here we find that in an open region, interregional migration of workers may give additional momentum to the economic expansion, by relieving pressure on the real wage and the CPI to their baseline values and restoring the lost competitiveness. By considering different simulation scenarios we show that there is a friction between the economic stimulus from increasing household energy efficiency and the rebound effects.

AB - This paper investigates the economy-wide impacts of a 5% improvement in Scottish household energy efficiency, focussing specifically on general equilibrium energy rebound effects, both in household energy use and in total energy use across the Scottish economy. The impacts are measured through simulations using an intertemporal single region computable general equilibrium (CGE) model. Previous studies based on a national case show that improving efficiency in household energy can stimulate the economy through an increase and change in the pattern of the aggregate demand. However, this may put upward pressure on domestic prices, thereby crowding out exports. Here we find that in an open region, interregional migration of workers may give additional momentum to the economic expansion, by relieving pressure on the real wage and the CPI to their baseline values and restoring the lost competitiveness. By considering different simulation scenarios we show that there is a friction between the economic stimulus from increasing household energy efficiency and the rebound effects.

KW - renewable energy policy

KW - climate change

KW - Scotland

KW - UK energy market

KW - computable general equilibrium model

KW - economy-wide rebound

KW - household energy efficiency

M3 - Other report

BT - Increasing Energy Efficiency in Scottish Households

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