The aim of the paper is to identify the added value from using general equilibrium techniques to consider the economy-wide impacts of increased efficiency in household energy use. We take as an illustrative case study the effect of a 5% improvement in household energy efficiency on the UK economy. This impact is measured through simulations that use models that have increasing degrees of endogeneity but are calibrated on a common data set. That is to say, we calculate rebound effects for models that progress from the most basic partial equilibrium approach to a fully specified general equilibrium treatment. The size of the rebound effect on total energy use depends upon: the elasticity of substitution of energy in household consumption; the energy intensity of the different elements of household consumption demand; and the impact of changes in income, economic activity and relative prices. A general equilibrium model is required to capture these final three impacts.
|Place of Publication||Glasgow|
|Publisher||University of Strathclyde|
|Number of pages||52|
|Publication status||Published - May 2013|
- energy efficiency
- indirect rebound effects
- economy-wide rebound effects
- household energy consumption
- cge models
Lecca, P., McGregor, P., Swales, J. K., & Turner, K. (2013). The Added Value from a General Equilibrium Analyses of Increased Efficiency in Household Energy Use. (08 ed.) (pp. 1-51). Glasgow: University of Strathclyde.